Euro continued to slide in Europe as preliminary December Inflation showed a drop to 1.6%y/y well below the 2-3% band opening up the potential of more rate cuts. The pair bounced off support at 1.3300 rallying as FOMC minutes painted a bleak US picture. Looking ahead for December German Unemployment is forecast at 3.07Mn with an unemployment rate at unchanged at 7.5%. Also released Euro zone PPI output for November seen falling -1% to a 4.3% y/y rate. Sterling mixed data and a buoyant market mood allowed the pair to rally back towards 1.5000 on cable. Heavy GBP/JPY buying and EUR/GBP once again supported the pair. December PMI Services increased to 40.2 vs. 39 previously. Also released Nationwide House Prices which dropped -2.5% in December.
Technical Outllook:
EURO R1: 1.3600 S1:1.3380
R2: 1.3620 S2:1.3370
chart pattern indicates the currency to give bearish note for the day. Trading range for the day is expected between 1.3390-1.3580 levels for the day. Momentum is seen trending down giving bearish signals and currency is also trading below the moving averages supporting the bear note but stochastic is giving caution signal.
EURO R1: 1.3600 S1:1.3380
R2: 1.3620 S2:1.3370
chart pattern indicates the currency to give bearish note for the day. Trading range for the day is expected between 1.3390-1.3580 levels for the day. Momentum is seen trending down giving bearish signals and currency is also trading below the moving averages supporting the bear note but stochastic is giving caution signal.
GBP R1: 1.5010 S1: 1. 4760
R2: 1.5030 S2: 1. 4750
chart pattern shows the currency to remain mixed for the day. Trading range is expected between 1.4790-1.4990 levels for the day. Currency is trading above the moving average and parabolic is also supporting bull note and stochastic is also seen trending up but caution is given by Momentum which is seen trending down.
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