Is the virus coming back? What's happening with gold? How is Brexit doing? We will briefly discuss these burning topics in relation to this week's Forex movements.
Weekly Forex Outlook: December 10-14
Let’s have a look at the economic calendar.
US PPI figure will be out on Tuesday. Also that day the market anticipates a release of the British Average Earnings Index. And of course, we all are waiting for the UK Parliament Brexit Vote. If the Parliament votes against the deal, the British pound will plunge. Otherwise, the end of the Brexit will come closer and the British pound will be supported.
Wednesday will bring important economic data for the USD. CPI and Core CPI figures may support the suffering US dollar.
On Thursday, traders will get a chance to trade on central bank meetings. The European central bank and the Swiss National Bank will give clues on the current economic conditions and future monetary policy. If banks sound optimistic, it will support domestic currencies.
On Friday, Retail Sales and Core Retail Sales data will determine the direction of the USD.
Let’s have a look at the technical side.
Where will the GBP go?
The direction of the British pound will depend on the Brexit deal news. In the case of a progress, the GBP will be able to leave the range of risky lows. Key resistances are at 1.2824 and 1.2921. However, worries that the Parliament votes against the Brexit deal prevail. In the case of the negative outcome of the vote, the GBP will fall. Supports are at 1.2643 and 1.2559.
Has the EUR broken the downtrend? It seems like the EUR has left the downward channel. A rise of the EUR/USD pair is caused by the weakness of the USD. If the USD is weaker and the economic data are encouraging, the pair may rise to 1.1488, the next resistance is at 1.1551. However, risks of the fall still exist. A break of 1.1374 will pull the pair to 1.1323 and lower.
What is the trend of the USD/JPY? The pair has formed a double top pattern. The direction of the pair depends on the strength of the USD and the market sentiment. If the USD recovers and the pair rebounds from 112.50, the rise is more likely. Resistances are at 112.90, 113.5990. If the pair breaks the support at 112.50, the fall to 111.3143 is highly expected.
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