Week Ahead December 18 – 22

EURUSD pair closed last week’s trading session higher on divergence between the two central banks. FED maintained interest rate unchanged as it was widely expected, although the minutes and the speech of FED’s chairman Jerome Powell sent a dovish signal in the markets by highlighting the interest rate reduction during 2024. On the other hand, ECB also maintained interest rates unchanged, but, comments during the speech by ECB’s president Christine Laggard were hawkish as the central bank will keep interest rate higher through 2024 until they achieve their inflation target, that now has been revised lower.

As for this week, traders and investors will focus on the economic calendar with the main releases around CPIs and speeches from many FED’s and ECB’s officials. US gross domestic and durable goods will need to conform if US economy is healthy and can support this interest rate levels.

On the economic calendar we have on Tuesday, the European core harmonized consumer prices pointing at 3.6% On Wednesday, US consumer confidence expected at -4.1% and European consumer confidence at -16.5 On Thursday, US gross domestic product to remain unchanged at 5.2% On Friday US core personal consumption pointing lower at 3.4% and Michigan consumer sentiment unchanged at 69.4

Technically the picture is neutral after last week’s close below (61.8%) at 1.0894 In this week’s trading session if pair continues on the upside and break and close above (61.8%) will change the overall picture to positive and could open the road for 1.1270 (100%) If resumes on the downside it will retest 1.0760 (38.2%) Our traders took profit their long positions at 1.0966 and turn short at 1.0966 (61.8%)  targeting profits at 1.0760  We are expecting more aggressive short  positions on the way up and new long positions at 1.0760

GBPUSD pair closed last week’s trading session higher on divergence between the two central banks. FED maintained interest rate unchanged as it was widely expected, although the minutes and the speech of FED’s chairman Jerome Powell sent a dovish signal in the markets by highlighting the interest rate reduction during 2024. On the other hand, BOE also maintained interest rates unchanged, but, avoid to release any comments regarding future policy. During the speech of BOE’s Governor Bailey, he said is too early to discuss anything related to interest rate change.

As for this week traders and investors will mostly focus on economic releases, especially the UK CPI release that is expected to show a lower print in inflation and the Gross domestic products from both sides the US and the UK.  Many FED’s and BOE’s officials are due to speak during the week and is good to hear what their position will be in the future interest rate decisions.

On the economic calendar we have on Wednesday, UK consumer price index pointing lower at 4.4% and US consumer confidence expected at -4.1% On Thursday, US gross domestic product to remain unchanged at 5.2% On Friday UK Gross domestic product to remain unchanged at 0.6% UK retail sales lower at -1.8% US core personal consumption pointing lower at 3.4% and Michigan consumer sentiment unchanged at 69.4

Technically the pair’s overall picture is positive after last week’s close just below (61.8%) at 1.2674 As for this week, if pair continues on the upside, a break and close above (61.8%) will accelerate gains and open the road for 1.3126 Alternative, if resumes on the downside, will retest 1.2596 (50%) Our traders opened new short positions at 1.2723 targeting profits at 1.2500. We are expecting more aggressive short sellers above 1.2900 targeting profits at 1.2500 and long positions at 1.2460 targeting profits at 1.2825

For more detailed economic calendar events please visit our live economic calendar on: 

https://tentrade.com/economic-calendar/

*The material does not contain an offer of, or solicitation for, a transaction in any financial instruments. TenTrade accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losing all your invested capital, so please make sure that you fully understand the risks involved.