As Dollar Gains Traction, Yields Stage Resilient Comeback in Dynamic Economic Landscape

Weekly Analysis of Major FX Pairs (December 20th–27th, 2023)

Most of the major FX pairs have managed to sustain their recently acquired trajectories. However, some are currently experiencing minimal losses, even as technical indicators remain positive. This calls for a closer investigation to gain insight into potential market developments.

Weekly Analysis of Major FX Pairs (December 20th–27th, 2023)

EURUSD: Bearish

EURUSD’s price action recently rebounded upward from support near the 1.0882 price level. Yesterday’s trading session witnessed a more significant boost, indicated by the appearance of the corresponding price candle.

Although today’s session has delivered a minimal downward correction, the market seems to maintain an upside trajectory. Trading activities remain above the middle limit of the applied Bollinger Bands, and the Stochastic Relative Strength Index (RSI) suggests the potential for continued upward movement toward the 1.1050 mark.

Weekly Analysis of Major FX Pairs (December 20th–27th, 2023)

GBPUSD: Bearish

The GBPUSD price action continues along an upward-sloping trendline established around November 2nd. Despite intermittent interruptions, this major FX pair has recovered its trajectory, maintaining an upside path.

While the market has broken above the 1.2700 price mark, the ongoing session has introduced a minimal correction. Trading activities, however, remain above the middle limit of the Bollinger Bands. Additionally, the RSI indicator lines have converged for a bullish crossover, indicating the potential for an extended upside retracement toward the 1.2800 price level.

 

USDCHF: Bearish

USDCHF bulls have yet to challenge downward forces, resulting in a continuous downward spiral since breaking through the resistance at the 0.9200 price level.

The minimal upside correction in the ongoing session clings to the lowest band of the Bollinger Bands indicator, bringing the pair to a six-month low. The Stochastic RSI lines continue to trend downward, suggesting that price action may persist toward lower levels, possibly falling below the 0.8552 price level.

USDCAD: Bearish

The USDCAD market has strengthened its bearish path, with downward retracement gaining momentum and forcing price action lower. Trading activities remain below the middle limit of the Bollinger Bands.

Today’s session has offered only a very minimal upside rebound, and the RSI line, while in the oversold zone, has delivered a bullish crossover that appears somewhat sideways. Weak momentum in the ongoing session, combined with price action hugging the lowest limit of the Bollinger Bands, indicates potential movement toward the 1.3300 mark.

Weekly Analysis of Major FX Pairs (December 20th–27th, 2023)

AUDUSD: Bullish

Amidst the major FX pairs of the week, AUDUSD stands out as it continues its upward trajectory. Buyers remain favored in the ongoing session, driving price action higher towards levels above 0.6700.

Despite thinning volatility, the market clings to the uppermost limit of the applied Bollinger Bands indicator. The RSI lines rising into the overbought zone suggest the potential for the market to break through the 0.6800 resistance based on the standing fundamentals.

EURJPY: Bearish

In the day-to-day dynamics of the EURJPY market, bears have retained dominance since the initiation of a corrective downturn towards the conclusion of the previous month. Last week witnessed a gradual re-entry of buyers, fostering stability in the price action range of 155.00 to 157.00.

The recent trading session propelled the pair beyond the 157.00 price threshold, yet the upper shadow on the associated price candle hints at some resistance—potentially influenced by traders hitting their targets or encountering economic challenges. Today’s trading activity introduced modest downward corrections, as indicated by the corresponding price candle. Nevertheless, the Stochastic Relative Strength Index continues to suggest the potential for ongoing upward momentum in price action, aiming toward the 159.00 mark.

USDJPY: Bearish

The USDJPY market has relinquished its bullish path, resulting in a downward trend. Although bulls have introduced intermittent interruptions, fundamentals supporting the downward correction seem to have overpowered attempts to avert the effects of bearish pressure. Recent price action attempted to break through the resistance formed by the 144.00 level.

However, today’s trading session brought a minimal downward correction. The RSI indicator still points out that bullish momentum is intact, with the indicator lines continuing to rise upwards. While fundamentals will play a key role in deciding the market’s direction, traders may wait for price action to break through the 144.00 mark before considering long positions in this major FX pair.

 

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