Forex trading plan for December 14

By Elizabeth Belugina

The market is waiting for the Fed’s meeting on Wednesday. Falling oil is the main newsmaker.

EUR/USD: The pair remained last week below the resistance at 1.1030 (200-day MA). Below 1.0950 the euro will slide to 1.0915 and 1.0880. Rise above 1.1030 will provoke another round of short covering and open the way to 1.1115 (61.8% Fibo of decline from October high). Watch German ZEW economic sentiment at 10:00 GMT (forecast is positive).

GBP/USD: The pair is forming bearish engulfing candle on the daily chart, so the pound is vulnerable for a decline to 1.5030/00. There’s some support at 1.5107/00 (October low). Pound was sold on some dovish comments from the Bank of England and weak oil. Britain will release a block of inflation data at 09:30 GMT. Resistance is at 1.5200/30 and 1.5270 (daily Ichimoku Cloud).     

USD/JPY: The pair found support in the 120.60 area. We expect an increase from here, but think that the pair will meet new selling pressure on recoveries to 121.05 and 121.50/60. Cautious risk sentiment and good data from Japan created demand for the yen. Below 120.60 support is at 120.22/00. 

AUD/USD: The pair managed to return above the 100-day MA at 0.7188. The 55-day MA is about to cross this line to the upside that will be a positive sign. However, a lower high formed last week mean that selling pressure will persist. The minutes of the Reserve Bank of Australia’s meeting will be released at 00:30 GMT. Resistance is still at 0.7250 and 0.7280. Falling commodity prices won’t allow Aussie to recover much from here, so the potential trade involves selling at resistance.  

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