Currency Analyst since 2010

Forex trading plan for December 9

EUR/USD is trading in the 1.0880/00 area. German industrial production rose less than expected, and the euro area’s Sentix investor confidence index missed expectations as well. Still, there are no market moving news from either the euro area or the United States that will give traders new food for thoughts for traders. The same will be on Wednesday. Resistance is at 1.0900, 1.0985 (55-day MA) and 1.1030/50. Support is at 1.0795 (Monday low) and 1.0760 (November 19 high).

GBP/USD slid below 1.5000. British manufacturing production contracted by 0.4% in October. Support is at 1.4950, 1.4888 and 1.4850. Resistance is at 1.5030, 1.5100 and 1.5150.

USD/JPY fell to 123.00. Japanese Q3 GDP was revised to the upside. This together with the market’s risk aversion gave the yen the reason to strengthen. Levels of 120.50/20 are now in focus. Resistance is at 123.60.   

AUD/USD dipped to 0.7200 breaking the short-term uptrend to the downside. Chinese trade data came out weak. China will release inflation figures on Wednesday morning. AUD/USD erased 50% of the advance from November lows. Next support is at 0.7155. Aussie’s divergence with the fallen iron ore is starting to influence the pair. Resistance is at 0.7250 and 0.7280.

The Reserve Bank of New Zealand will meet late on Wednesday (20:00 GMT). Manufacturing activity data released on Monday surprised to the upside, but the market is expecting the RBNZ to cut the benchmark rate by 25 bps. Among the arguments for such scenario are low commodity prices, mixed state of New Zealand’s economy and the sense that the upcoming increase in the Federal Reserve’s rate is already priced in USD rate. Support is at 0.6575 and 0.6515/00. If the RBNZ follows Australian and Canadian central banks and leaves rate unchanged, NZD/USD can jump to 0.6680 and 0.6750. It will be also important what the RBNZ signals about the further changes in the interest rate.  

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