EU Session Bullet Report – USD trades lower ahead of the FED

The USD is weakening against low-yielding currencies like the EUR, JPY and CHF but strengthening against commodity currencies like the CAD. EURUSD hit a one month high at 1.1047 before retreating.

On the contrary, the GBPUSD weakened after dovish remarks from a BoE member mentioning that he ‘won’t vote for a rate hike until convinced wage growth will be sustained at a level consistent with inflation target; for the record, BoE is expected to be the next bank after the FED that will raise rates.

As oil prices continue to be under stress (+0.08%) stock markets continue to feel the pressure, dragged down mostly by energy stocks. German DAX dropped more than 2% however, in the US, major indexes erased early losses and marked gains as oil prices found support.
The declining oil price trend is still in place, though, and it is too early to call the bottom.

Key market drivers continue being the FED rate decision tomorrow and the developments in oil prices.

The last piece of interesting US data ahead of the Fed decision will be released today with the November US inflation numbers.

Trading quote of the day:

If past history was all there was to the game, the richest people would be librarians.

Warren Buffett

EUR/USD
Pivot: 1.098
Likely scenario: long positions above 1.098 with targets @ 1.105 & 1.1075 in extension.
Alternative scenario: below 1.098 look for further downside with 1.0945 & 1.0925 as targets.
Comment: the RSI is bullish and calls for further upside.

GBP/USD
Pivot: 1.5205
Likely scenario: short positions below 1.5205 with targets @ 1.5105 & 1.508 in extension.
Alternative scenario: above 1.5205 look for further upside with 1.5245 & 1.531 as targets.
Comment: as long as the resistance at 1.5205 is not surpassed, the risk of the break below 1.5105 remains high.

AUD/USD
Pivot: 0.719
Likely scenario: long positions above 0.719 with targets @ 0.728 & 0.731 in extension.
Alternative scenario: below 0.719 look for further downside with 0.7155 & 0.713 as targets.
Comment: technically the RSI is above its neutrality area at 50.

USD/JPY
Pivot: 121.35
Likely scenario: short positions below 121.35 with targets @ 120.3 & 119.6 in extension.
Alternative scenario: above 121.35 look for further upside with 121.85 & 122.25 as targets.
Comment: as long as 121.35 is resistance, look for choppy price action with a bearish bias.

USD/CAD
Pivot: 1.3675
Likely scenario: long positions above 1.3675 with targets @ 1.378 & 1.383 in extension.
Alternative scenario: below 1.3675 look for further downside with 1.362 & 1.3565 as targets.
Comment: even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

USD/CHF
Pivot: 0.9865
Likely scenario: short positions below 0.9865 with targets @ 0.9785 & 0.975 in extension.
Alternative scenario: above 0.9865 look for further upside with 0.9915 & 0.995 as targets.
Comment: the RSI is badly directed.

GOLD
Pivot: 1072
Likely scenario: short positions below 1072 with targets @ 1058 & 1052 in extension.
Alternative scenario: above 1072 look for further upside with 1077.5 & 1081.5 as targets.
Comment: as long as 1072 is resistance, likely decline to 1058.

OIL
Pivot: 35.17
Likely scenario: long positions above 35.17 with targets @ 36.9 & 37.54 in extension.
Alternative scenario: below 35.17 look for further downside with 34.52 & 33.95 as targets.
Comment: the RSI is bullish and calls for further upside.

DAX
Pivot: 10450
Likely scenario: short positions below 10450 with targets @ 10120 & 9990 in extension.
Alternative scenario: above 10450 look for further upside with 10660 & 10830 as targets.
Comment: as long as 10450 is resistance, look for choppy price action with a bearish bias.

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TIME IS IN GMT(+2)

Report prepared by the easy-forex VIP desk at 06:20 GMT.

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