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EURUSD and GBPUSD in ranges, but with downside risks

Published:
Updated:

  • The US Dollar has seen a slightly more positive tone through December with the passage of the tax reform legislation.
  • For EURUSD we see an intermediate-term range between 1.1961 and 1.1712.
  • But December weakness was reinforced after the ECB Meeting last week and sets the risks for a more bearish shift into December (through 1.1712).
  • GBPUSD remains within a broader non-trend environment (1.3026-1.3658), but December recovery failures places the bias to the lower end of the range into year-end.

EURUSD

Downside bias

A negative tone Friday to reinforce downside pressures after Thursday’s ECB Meeting, to surrender 1.1765/63 supports and keep the bias lower for Monday.

We still see an intermediate-term neutral, broader range theme for December (with the range mow see as 1.1961-1.1712).

For Today:

  • We see a negative tone to aim for the key 1.1716/12 area; below here targets 1.1660.
  • But above 1.1781 sees the bias to 1.1809, possibly towards 1.1863.

Intermediate-term Range Parameters: We see the range defined by 1.1961 and 1.1712.

Range Breakout Challenge

  • Upside: Above 1.1961 targets 1.2089 and aims higher for 1.2173, 1.2272 and 1.2600.
  • Downside: Below 1.1712 targets 1.1553 and sees risk lower for 1.1311 and 1.1107.

Resistance and Support:

1.1781 1.1809* 1.1863** 1.1900/03 1.1961***
1.1716/12*** 1.1660** 1.1621 1.1584 1.1553***

4 Hour Chart

EURUSD Chart

GBPUSD

Negative bias

A late sell off Friday through 1.3391 and 1.3346 supports to probe into the 1.3302/1.3290 foundation area, to re-energize negative pressures from the earlier December down trend through 1.3319 support, shifting the bias lower for Monday.

We still see an intermediate-term neutral range theme into December (1.3026-1.3658).

For Today:

  • We see a negative tone through the 1.3302/1.3290 support area; below here targets 1.3220, maybe 13181.
  • But above 1.3372 sees the bias to 1.3421, possibly towards 1.3466.

Intermediate-term Range Parameters: We see the range defined by 1.3026 and 1.3658.

Range Breakout Challenge

  • Upside: Above 1.3658 aims higher for 1.3841 and 1.4000.
  • Downside: Below 1.3026 sees risk lower for 1.2773 and 1.2587.

Resistance and Support:

1.3372 1.3421 1.3466* 1.3520* 1.3549*
1.3302/1.3290** 1.3220** 1.3181 1.3113 1.3060**

4 Hour Chart

GBPUSD Chart