Daily Technical Analysis. Tuesday, December 19
The Euro rose slightly on Tuesday after a significant rally against the Dollar yesterday, finding support from the stability of Inflation last month as the Dollar fell against major currencies.This week, market analysts are focused on the US Congress Vote toward the Tax Reform Law, which may be activated before the end of the year.
Technical reading shows that EURUSD prices are still moving within the framework of a positive correction toward a general bearish trend. Resistance levels at 1.1835 and 1.1860 are still considered the most important short-term levels and these levels are likely to consolidate the bearish trend, while any short-term trend reversal will negatively affect price action.
The US Dollar edged higher on Tuesday after weakening against the Yen yesterday, on the back of strong Asian Stocks performance.
The Japanese Government has raised its Growth forecast for both the current fiscal year and next year to 1.9% and 1.8%, respectively, with a stable improvement in domestic demand, after expectations of growth of 1.5% and 1.4%.
The return of selling pressures on the USDJPY’s movement would reinforce the previous bearish trend. A break below the support level at 112.50 would consolidate the pair and cause a test at the 112.30 levels. The return of the price above the resistance level at 112.60 would temporarily ease selling pressure.
The return of selling pressures on the pair’s move would reinforce the current bearish trend. A break below the support levels near 0.9840 will consolidate the declines and open the door to test the levels of 0.9800 alone. The return of the price above the resistance level at 0.9860.
Gold prices rose slightly on Tuesday as Dollar continued to weaken against a basket of major currencies, as well as the reaction of Investors toward the US Tax Cuts scenario. The markets are witnessing a significant decline in cash volumes due to the start of the Holiday Season, which usually affects trading volumes.
Despite recent price hikes, the precious metal still has to break above the resistance levels at 1262 and 1267 to confirm the uptrend. A drop below the support levels at 1260 would affect the uptrend and introduce a sideways trend instead.