Eurodollar Sees Significant Rise, Beware of Pullback【December 28, 2023】
Fundamental Analysis
The Eurodollar has broken through USD 1.10, making a significant rise and entering the overbought zone.
There is a split opinion within the Bank of Japan, with high market expectations for interest rate normalization.
Japan anticipates rate hikes, while the global trend is expected to lean towards rate cuts.
EURUSD Technical Analysis
Analysis of the Eurodollar daily chart shows a move above the crucial USD 1.10 mark, surpassing USD 1.11. The 52-day moving average is being acknowledged, showing an upward trend. At USD 1.1130, there is a monthly resistance line, with a high possibility of a temporary overshoot followed by a pullback.
Due to the continued trend of a weaker dollar, a long-term upward trend is expected. The daily RSI stands at 64, with the possibility of USD 1.107, 61.8% Fibonacci expansion, becoming a new support line. The market appears slightly overextended, hence, short-term pullbacks should be watched.
Day Trading Strategy (1-Hour Chart)
Analyzing the Eurodollar 1-hour chart, the current upward trend line is significant, showing a pullback at the 100% Fibonacci expansion. Notably, 161.8% corresponds to USD 1.1250, a target price after breaking 100%.
There is a significant resistance line at USD 1.1130, and a breakout above this level is not easy. With the RSI at 72, entering the overbought zone, a dip below 70 might indicate position adjustments. The market sentiment shows 92% in selling positions.
The day trading strategy suggests a limit sell at USD 1.1130, take profit at USD 1.1075, and a stop loss at USD 1.1165.
Support and Resistance Lines
Upcoming resistance lines to consider:
USD 1.1113 – Monthly resistance lineUSD 1.1075 – Daily Fibonacci expansion 61.8%USD 1.10 – Round number
Market Sentiment
EURUSD Sell: 92%, Buy: 8%
Today’s Important Economic Indicators
Economic Indicators and EventsJST (Japan Standard Time)Japanese Retail Sales8:50Unemployment Insurance Claims22:30Crude Oil InventoryNext 1:00
*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.
Risk Disclaimer
This analysis is for educational purposes only and does not constitute investment advice. Trading forex and CFDs involves significant risk and may not be suitable for all investors. Past performance is not indicative of future results.
This analysis is for educational purposes only and does not constitute investment advice. Trading forex and CFDs involves significant risk and may not be suitable for all investors. Past performance is not indicative of future results.
