Daily Forex Market Preview, 29/12/2017
The U.S. dollar extended declines, falling to a three-month low, led by many factors including end of year balancing from portfolio managers. The decline in the greenback led the commodity markets to maintain the gains. Gold prices continued to extend the rally, rising to $1294 an ounce.
Crude oil prices also held up stronger as the EIA’s crude oil inventory report showed that stockpiles declines 4.6 million barrels during the previous week which was more than expected.
On the economic front, the weekly unemployment claims rose 245k more than the expected 240k while the Chicago PMI was seen rising to 67.2 compared to estimates of 62.2 and up from 63.9 previously.
Looking ahead, the economic calendar is quiet today. From the Eurozone the preliminary inflation details from Germany and Spain will be released today.
EURUSD intra-day analysis
EURUSD (1.1943): The EURUSD rallied to briefly test the 1.1954 handle before slightly retreating back. The currency pair managed to close at a 3-month high at 1.1941. The gains came amid a weaker U.S. dollar. On the 4-hour session, the currency pair was seen closing above the 1.1920 handle which could now come in as support. Establishing support at this previous resistance level is likely to signal further gains in the near term. However, this comes at a risk that the currency pair might close below the level in which case the sideways momentum could still be maintained. The next lower support comes in at 1.1843 – 1.1822 level.
