On Tuesday 12th of December, the event calendar is quite busy with various economic data releases. During the London session, France will publish data, the UK will present Consumer Price Index data and Germany will post ZEW Economic Sentiment data. During the US session, the US will post PPI index data and Federal Budget Balance data. ECB Chair Mario Draghi speech is scheduled at 07:00 pm GMT.
GBP/USD analysis for 12/12/2017:
The beginning of the week on the FX market was not spectacular. The news from New York contributed to the temporary outflow of capital towards safe havens, after an attack with an improvised bomb was confirmed. At the head of the G10 currency basket, the New Zealand dollar is still in the lead as the choice of Adrian Orr for the Governor of the RBNZ next term makes NZD/USD rally 1.1%.
Consumer inflation in the United Kingdom is to remain at 3.0%, but since the Bank of England is just after the interest rate hike, the data at this stage are not a significant point of appreciation. At present, the political turmoil around Brexit plays a more important role in the predominance of threats and opportunities, so it seems more reasonable to extinguish the possible strength of the Pound after the data.
Let's now take a look at the GBP/USD technical picture at the H4 time frame. The market dropped to the technical support level at 1.3338 and broke below the lower channel line. This is the key level of support for bulls, so if violated, then the price might accelerate the sell-off towards the level of 1.3279 and 1.3211. The momentum indicator is below its fifty level, which supports the bearish bias.
Market Snapshot: Crude Oil bounces heavily
The price of Crude Oil bounced from the level of 55.65 after the news, that the largest British pipeline transporting Crude Oil from the bottom of the North Sea can be shut down for several weeks due to an uncovered leakage. Currently, the price is trading close to the short-term trend line resistance around the level of 58.70, but it looks like the target is the recent high at the level of 59.04. Strong bullish momentum supports the bias.
Market Snapshot: EUR/GBP tests the trend line resistance
The price of EUR/GBP has bounced from the level of 0.8688 to test the long-term trend line resistance around the level of 0.8830. This is the key resistance zone, because the supply zone between the levels of 0.8840 - 0.8868 is close and all the moving averages are close as well. It will be a tough area to violate, which is why the outlook remains bearish.
The price of EUR/GBP has bounced from the level of 0.8688 to test the long-term trend line resistance around the level of 0.8830. This is the key resistance zone, because the supply zone between the levels of 0.8840 - 0.8868 is close and all the moving averages are close as well. It will be a tough area to violate, which is why the outlook remains bearish.
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