Analysis for December 15th, 2014
EURUSD, “Euro vs US Dollar”
The market was opened with a gap up today. Eurodollar is trying to continue its ascending movement, but hasn’t been able to stay above level of 1.2456. This descending movement may be considered as a wave towards level of 1.2360; while moving downwards, the pair may form triangle consolidation pattern. We think, today the price may continue forming this pattern. If later the price breaks it downwards, the current correction may continue; if upwards – Euro may form the third ascending wave.
GBPUSD, “Great Britain Pound vs US Dollar”
Pound hasn’t been able to break level of 1.5730 and stay above it for a couple of weeks already. It means that we can’t be sure if the pair is going to reach level of 1.5800. This uncertainty may result in a new descending movement and new lows. We think, today the price may continue consolidating at the current levels and try to start a new ascending movement.
USDCHF, “US Dollar vs Swiss Franc”
The market was opened with a gap down today. Franc is trying to continue its descending movement, but hasn’t been able to stay below level of 0.9638. The pair is expected to form a higher correction towards level of 0.9723. We think, today the price may form triangle consolidation pattern. If later the price breaks it upwards, the pair may form a correction; if downwards – continue falling and forming a descending wave.
USDJPY, “US Dollar vs Japanese Yen”
Yen is still forming triangle consolidation pattern. We think, today the price may break it downwards and continue falling towards the target at level of 117.10. However, the pair may break it upwards and reach level of 120.00 (as a correction). After reaching it, the price may fall again towards the above-mentioned target. This descending structure may be extended, thus forming the first wave of the downtrend.
AUDUSD, “Australian Dollar vs US Dollar”
Australian Dollar is still falling inside a descending channel with the target at 0.8500. Any attempt of the price to return to level of 0.8294 may be considered as an opportunity to increase short positions.
USDRUB, “US Dollar vs Russian Ruble”
Ruble wasn’t able to rebound to start a new correction and continued moving upwards. We think, today the price may reach level of 59.19 and then return to level of 54.80. This structure may be considered as an upside continuation pattern towards level of 66.70.
XAUUSD, “Gold vs US Dollar”
Gold has reached the target of its correction and right now is moving upwards. We think, today the price may form an ascending wave to reach level of 1250 and then start a new correction towards level of 1190.
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Editors’ Picks
EUR/USD treads water just above 1.0400 post-US data
Another sign of the good health of the US economy came in response to firm flash US Manufacturing and Services PMIs, which in turn reinforced further the already strong performance of the US Dollar, relegating EUR/USD to the 1.0400 neighbourhood on Friday.
GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
Rising tensions between Russia and Ukraine caused renewed unease in the markets this week. Putin signed an amendment to Russian nuclear doctrine, which allows Russia to use nuclear weapons for retaliating against strikes carried out with conventional weapons.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
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