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EUR/USD Could Resume Increase In The New Year

Aayush Jindal

Aayush Jindal

Key Highlights

  • EUR/USD could gain bullish momentum above the 1.0750 resistance.
  • A key bullish trend line is forming with support near 1.0650 on the 4-hours chart.
  • GBP/USD is facing resistance near the 1.2200 and 1.2220 levels.
  • The Euro Zone Manufacturing PMI could remain at 47.8 in Dec 2022.

 

EUR/USD Technical Analysis

The Euro started a minor downside correction from 1.0736 against the US Dollar. EUR/USD tested the 1.0575 before it started a fresh upward move.

Looking at the 4-hours chart, the pair was able to climb above the 1.0620 resistance zone. The pair remained well above the 1.0600 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).

There was also a move above the 50% Fib retracement level of the downward correction from the 1.0736 swing high to 1.0573 low.

On the upside, an initial resistance is near the 1.0735 level. The next major resistance may perhaps be near 1.0750. A clear move above the 1.0750 resistance might start a steady increase. In the stated case, EUR/USD may perhaps rise towards the 1.0800 level or even 1.0850.

On the downside, there is a key support at 1.0650. There is also a key bullish trend line forming with support near 1.0650 on the same chart.

A downside break below the 1.0650 zone might spark a major decline. The next major support sits near the 1.0575 level. Any more losses might open the doors for a move towards the 1.0500 support zone.

Looking at GBP/USD, the pair is stable above 1.2000 and might attempt a fresh increase above the 1.2220 resistance zone in the coming sessions.

Economic Releases

  • Germany’s Manufacturing PMI for Dec 2022 - Forecast 47.4, versus 47.4 previous.
  • Euro Zone Manufacturing PMI for Dec 2022 – Forecast 47.8, versus 47.8 previous.