Weekly Forecast

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EUR/USD Weekly Forecast (21st December 2020 – 25th December 2020)

Dec 19, 2020 05:30

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Fundamental view:

The Euro rallied during the week. The greenback was pressured by an optimistic mood related to Brexit talks and a US coronavirus relief package. The week went by and both issues remain unsolved, although investors are still waiting for positive news in the next couple of days.

In the past week, US Capacity Utilization Rate & Industrial Production monthly report created bearish atmosphere whereas US Core Retail Sales monthly report & Retail Sales monthly report on 16th December and Europe Belgian NBB Business Climate & US CB Leading Index monthly report on 18th December created a bullish atmosphere for the pair.

The major economic events deciding the movement of the pair in the next week are Euro GfK Consumer Climate, US GDP quarterly report, US CB Consumer Confidence Index at Dec 22, Euro GDP quarterly report at Dec 23, US Core Durable Goods Orders monthly report, and US Initial Jobless Claims at Dec 24.  

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.88% higher than the previous week. Maintaining high at 1.2273 and low at 1.2116 showed a movement of 157 pips.

In the upcoming week we expect EUR/USD to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1.2313 may open a clean path towards 1.2372 and may take a way up to 1.2470. Should 1.2156 prove to be unreliable support, the EURUSD may sink downwards 1.2057 and 1.1999 respectively. Chart formation of a bullish shark pattern in H4 chart creates prospects for a bullish trend. Spinning top formation in H4 chart escalates the expectation for a bullish trend.

Preference
Buy:  1.2231 target at 1.2371 and stop loss at 1.2151

 

Alternate Scenario
Sell: 1.2151 target at 1.2002 and stop loss at 1.2231
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