Forex Weekly Technical Analysis – 24/12/10
We are approaching year-end and thin market condition may result in high volatility.
When we look at monthly charts we see that this year EUR/USD climbed up to 1.4939 and later it went all the way back to where it started. For the long term, EUR/USD will probably continue to trade within its trading channel.
If we understand the general trend, it would be easier to forecast next year. Well, now let’s focus on the next week. EUR/USD will like to stay 1.3140 and 1.2990 trading range. Even though the bias is still bearish, the pair may climb up to 1.3280 if it can close successfully above 1.3140. However, a daily close below 1.2990 can push the pair down to 1.2740.
The latest report released by CTFC (Commitments of Traders report) shows that the currency speculators reduced their short positions slightly.
GBP/USD Technical Analysis
Some investors were thinking that British Prime Minister David Cameron’s recent refusal to sign a new EU treaty would hit GBP hard but it didn’t happen as they expected. EUR/GBP is in a free fall. This factor is slowing sterling’s fall against the greenback. For this week we expect a trading range between 1.5450 and 1.5770. If the pair can break 1.5770 resistance, it may try to climb to 1.5880. If 1.5450 support is broken then the next support is at 1.5340.
The latest Commitments of Traders report showed that the currency speculators have reduced their short positions. They reduced their net short GBP positions by 13.6K contracts to 25.9K