Merry Christmas and a Technical Analysis.
USD Update: The U.S. dollar, tracked by the DXY index, dipped nearly 0.65% to 101.75, marking its lowest point since late July. Thin liquidity before the Christmas holidays might amplify fluctuations, leading to losses for the American currency. The recent pullback is attributed to the Federal Reserve’s shift, signaling potential rate cuts in 2024. The dovish stance surprised investors, causing a significant drop in Treasury rates, notably the 2-year note falling below 4.40%.
GBP Analysis:
EUR Analysis: The EUR/USD hovers near 1.1000, potentially marking its highest daily close since early August. A breakout above this psychological level could signal further gains. Daily chart indicators favor an upside move, but caution is advised given current market conditions. On the 4-hour chart, technical indicators are less bullish, with the RSI flat and the MACD providing uncertain signals. Staying above 1.0950 suggests a favorable outlook for a break of 1.1000, while a slide below may weaken the Euro in the short term, exposing the next support at 1.0910.