EURUSD consolidates gains
The US dollar drifts lower as traders stick to rate cuts as the theme of the upcoming year. The pair is holding onto its gains after clearing the daily resistance and the psychological level of 1.1000. The upbeat mood may continue to attract buying interests looking to reclaim last summer’s peak of 1.1270. In the meantime, 1.1100 from July’s brief and faded bounce is the next hurdle. On the downside, 1.0980 is the immediate support while 1.0890 over the 20-day SMA is an important level to maintain the current momentum.
USDJPY struggles to rebound
The yen inched higher as BoJ Governor Ueda expressed optimism about achieving the inflation target. The pair is trying to bounce back from July’s trough with 141.10 as the latest support. A limited rally came to a halt at the round number of 145.00, suggesting that sellers are still in control of the near-term direction. The demand zone 138.50-140.50 is key in keeping the greenback afloat in the medium-term. 143.90 and dynamic resistance of the 20-day SMA are the first obstacles to lift to initiate a meaningful comeback.
SPX 500 grinds all-time high
The S&P 500 advances as bond yields stay muted amid rate cut bets. The index is flirting with January 2022’s peak and the all-time high of 4820. The price action is at a crossroads as the next step could shape the direction for the early weeks of the new year. A bullish breakout would bring in momentum traders at first and trigger a runaway rally, paving the way for fresh highs. However, a retreat below 4710 would force more buyers to take profit in addition to fresh selling from the bears, potentially triggering a correction.
