The updated data for the EUR/USD Forex pair as of December 21, 2023, indicates new developments in its recent trends, correlation dynamics, and predictive trading ranges. This analysis aims to supply insights into the latest state of the EUR/USD in the Forex market, taking into account the new changes in its trading behavior.
Trading Performance Following US Close on 12.21.2023
- Percentage Changes:
- Day-Over-Day Change: An increase of 0.60% from the previous day.
- Week-Over-Week Change: A growth of 1.19% over the past week.
- Month-Over-Month Change: A modest rise of 0.85% over the past month.
- Correlation and Strength:
- Weekly Correlation vs. FGC Dollar Indicator (our proprietary US Dollar Indicator): A negative correlation at -0.8872, slightly less intense than previously reported.
- Trading Condition: Remains ‘Neutral’.
- Key Support/Resistance Levels:
- Lower Extreme: 1.0860
- Lower Level: 1.0905
- Mid-Level: 1.0951
- Upper Level: 1.0996
- Upper Extreme: 1.1042
- Predictive Trading Range Probabilities:
- Upper Range (73.15% Chance): Less Than or Equal to 1.0979
- Mid-Range (35.02% Chance): Less Than or Equal to 1.0933
- Lower Range (13.02% Chance): Less Than or Equal to 1.0899
Analysis
- Positive Daily Movement: The increase in the day-over-day change is a bullish signal, indicating a short-term upward momentum.
- Sustained Growth Trend: Though modest, the week-over-week and month-over-month increases highlight a consistent upward trend for the Euro against the Dollar.
- Correlation Shift: The slight decrease in the negative correlation with the FGC Dollar Indicator may suggest changing dynamics in the Forex market, though it remains significantly negative.
- Neutral Market Outlook: The continued ‘Neutral’ state indicates a market that is not heavily skewed towards bullish or bearish sentiment. As mentioned in the report yesterday, this posture seems logical ahead of the Core PCE Price Index, the preferred inflation measure of the Feds, tomorrow.
- Trading Strategy Considerations:
- The support and resistance levels suggest 1.0951 (Mid-Level) as a key area to watch for potential shifts in market direction.
- The predictive trading range probabilities indicate a high likelihood (73.15%) of the pair moving below 1.0979, potentially acting as a resistance in the short term.
- The lower probability (13.02%) of dropping below 1.0899 suggests that this level may function as a strong support.
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