Community Forecasts for December 29-January 2: EUR/USD 1W Chart

Source: Dukascopy Bank SA
© Dukascopy Bank SA
In course of the previous trading week ended December 26, the pair was more stable than during several weeks before. By beginning the week on Monday, the Euro remained moderately higher against the Dollar, holding just above a two-year low after the release of better-than-expected Euro zone consumer confidence which improved to minus 10.9 points this month from minus 11.5 in November and disappointing home sales report from the US. Existing home sales dropped 6.1% in November to 4.93 million units from a revised total of 5.25 million in the previous month. However, gains of the shared currency were expected to remain limited due to negative German trade data and demand for the Greenback continued to be broadly supported. Moreover, German import prices dropped 0.8% in November, compared to expectations for a 0.5% loss. As a result, the Euro decreased to fresh two-year lows on Tuesday, since data showed that US consumer sentiment deteriorated less-than-expected in December and that the US economy grew at a faster rate than anticipated in the third quarter. Meanwhile, trading volumes are estimated to remain on low levels this week, with many investors taking a break for Christmas and New Year's celebrations. 
This week, Dukascopy traders became more bearish on the European currency's perspectives, as only 33% of all votes are set to go long on the EUR/USD currency pair at the moment. Despite that, the market is waiting for US consumer confidence, which is expected to be released on Tuesday. Moreover, traders are waiting for manufacturing PMI for December. Additionally from the European side, Markit manufacturing PMI is due to be announced the same day. The mean expectation for the Cable is placed around the 1.224 major level for the end of the current trading week. 

© Dukascopy Bank SA
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