Key Currency Pairs and Technical Analysis (4-Hour Chart) – December 13, 2024

Key Currency Pairs and Technical Analysis (4-Hour Chart) – December 13, 2024

Market Overview

EUR/USD – Buy

• Current Level: EUR/USD is trading near 1.0460, hovering around its lowest levels since November 26.
• Eurozone Factors:
  • ECB Rate Decision:
    • Refinance Rate: 3.15%
    • Marginal Lending Facility: 3.40%
    • Deposit Facility: 3.00% (lowest since March 2023).
  • Inflation Forecasts:
    • 2024: +2.4%
    • 2025: +2.1%
• US Impact:
  • PPI: Increased to +3.0% YoY (forecast: +2.6%).
  • Initial Jobless Claims: Rose from 225k to 242k.
  • ECB’s outlook could be heavily influenced by the Fed’s upcoming monetary policy decisions.

GBP/USD – Strong Sell

• Current Level: Trading near 1.2660, marking a new low since December 4.
• UK Factors:
  • October GDP: -0.1% MoM (forecast: +0.1%).
  • Industrial Production: -0.7% YoY (forecast: +0.2%).
  • BOE’s next meeting is on December 19, with rate cut expectations fading.
• US Factors:
  • The stronger-than-expected PPI continues to support USD strength.

AUD/USD – Strong Sell

• Current Level: Attempting to rise near 0.6370.
• Australian Factors:
  • November Employment Data:
    • Employment Change: +35.6k (forecast: +25k).
    • Unemployment Rate: 3.9% (forecast: 4.2%).
  • RBA Policy: Rates remain unchanged, with inflation suggesting a pause in easing measures.
• US Factors:
  • Strong PPI and a 90% probability of a Fed rate cut dominate sentiment.

USD/JPY – Strong Buy

• Current Level: Trading around 151.55, reaching highs not seen since November 27.
• Japanese Factors:
  • Large Manufacturers’ Sentiment Index: +14.0 in Q4 (forecast: +12.0).
  • Industrial Production: Slowed to +2.8% MoM (previous: +3.0% MoM).
• US Factors:
  • Strong PPI data boosts USD, with the Fed’s monetary policy decision in focus.

XAU/USD (Gold) – Sell

• Current Level: Slightly rising near 2690.00.
• Support Factors:
  • ECB and SNB rate cuts (25bp and 50bp respectively).
  • Middle East geopolitical risks.
  • China’s gold reserves increased by 16,000 ounces.
• Resistance Factors:
  • Rising US PPI dampens Fed rate cut expectations, limiting gold’s upside.

Key Events and Outlook

1. US CPI (Consumer Price Index):
   • A pivotal factor ahead of the December 17-18 FOMC meeting.
2. Eurozone Growth Forecast:
   • Ongoing ECB rate cuts bring uncertainty to economic recovery.
3. Geopolitical Risks:
   • Developments in the Middle East continue to pose potential market impacts.

Summary

The forex market remains active amid macroeconomic shifts, with USD and JPY strength dominating. Traders should monitor upcoming CPI data, Fed meeting expectations, and geopolitical developments as they influence key assets and potential market volatility.