EUR/USD: action to resume with the European opening

EUR/USD Current price: 1.2099

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The EUR/USD pair ended the year below the 1.2100 level, breached late Wednesday in ultra-thin market conditions. After the year-end holiday, market will slowly begin to resume its activity during the upcoming European, as in the Asian session, holidays remain in Japan, China and New Zealand. There will be several fundamental releases in Europe, including Markit Manufacturing PMIs for several of the member countries and the EZ itself. These readings may trigger some action, yet don’t expect positive readings to support more than an upward correction in the EUR/USD.

From a technical point of view, the 1 hour chart shows indicators flat in oversold territory and the price developing well below its moving averages, keeping the pressure to the downside. In the 4 hours chart indicators present a strong bearish momentum despite RSI stands below 30, all of which supports further declines. Next strong support comes at 1.2045, July 2012 monthly low, in route to the critical 1.2000 figure.

Support levels: 1.2080 1.2045 1.2000

Resistance levels: 1.2125 1.2150 1.2190

EUR/JPY Current price: 144.98

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Adding to latest Japanese yen strength, EUR weakness pushed the EUR/JPY cross to fresh 7-week lows of 144.76 by New York close. The 1 hour chart shows that the price extended well below its moving averages, whilst 100 crossed to the downside 200 SMA, and indicators turned lower below their midlines, all of which supports further declines. In the 4 hours chart indicators present a strong bearish momentum, while the price also develops below their midlines, pointing for another leg lower on a break below 144.75 immediate support.

Support levels: 144.75 144.40 143.90

Resistance levels: 145.50 145.90 146.45

GBP/USD Current price: 1.5579

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The GBP/USD pair advanced in the last trading day of 2014, reaching a 5-day high of 1.5619 before the price retraced some. On Friday, there will be several major releases in the UK, including Marking Manufacturing PMI, Mortgage approvals and Consumer Credit, and if the numbers result above expected, the Pound could extend its advance. In the meantime, the short term technical picture shows that the price holds above a bullish 20 SMA whilst indicators stand flat above their midlines, leaving a mild bullish tone in the 1 hour chart. In the 4 hours one, technical indicators stand in neutral territory, while the 20 SMA offers intraday support around 1.5550. As long as above this last level bulls remain in control, with renewed buying interest above the 1.5620 level probably triggering a quick spike up to 1.5650.

Support levels: 1.5550 1.5520 1.5485

Resistance levels: 1.5620 1.5650 1.5690

USD/JPY Current price: 119.81

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The USD/JPY pair extended its recovery up to 119.39 last Wednesday, boosted by better than expected US Pending Home Sales up 0.8% in November. An early week dip found buyers around the 38.2% retracement of the latest bullish rally measured from 115.59, Dec 16 low to 120.82, Dec 23 high, at 118.80.  Currently trading above the 23.6% retracement of the same rally at 119.55 the immediate support, the 1 hour chart shows that the price is being limited to the upside by its 200 SMA, while 100 SMA offers further resistance around 120.15. Indicators in the mentioned time frame turned lower, but remain above their midlines. In the 4 hours chart however, indicators present a mild bearish tone, as per heading lower right below their midlines. Some follow through above the 120.15 resistance is required to confirm a new leg up, while a break below 119.55 on the other hand should see the pair correcting lower, towards the 119.00 price zone.

Support levels: 119.55 119.20 118.80

Resistance levels: 119.90 120.15 120.50

AUD/USD Current price: 0.8165

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The Australian dollar advanced up to 0.8215 against its American rival, following better than expected Chinese data earlier this week. But the pair eased on Friday amid dollar demand, extending down to the 38.2% retracement of its latest bullish run measured from the year low at 0.8087 to the mentioned high of 0.8215. Technically, the 1 hour chart shows that the price extended below its 20 SMA whilst indicators maintain the bearish tone well into negative territory. In the 4 hours chart the price held above a flat 20 SMA now offering immediate support around 0.8155, while indicators turned strongly lower and are about to cross their midlines to the downside. A break below the mentioned 0.8155 level therefore, should lead to a continued decline towards 0.8085 whilst sellers will likely surge again on approaches to the 0.8200 figure.

Support levels: 0.8160 0.8120 0.8085

Resistance levels: 0.8200 0.8240 0.8270