Weekly Outlook | Busy Central Bank Week

Important events this week:

Last week, the NFP- data came in slightly stronger than expected at 227.000 newly created jobs. Since the Dollar had lost some steam in the days prior to the news event, market participants used the strong data to freshly by the Greenback, again. The trend might continue in the near future. This week, important interest rate decisions will guide market participants.

– AU – interest rate decision – As we mentioned above in particular the AUDwas losing steamagainstthe Greenback. With the break of the technical support zone in the AUDUSD pair at 0.6450 the downside might now continue.

The interest rate is expected to remain the same. Any further rate cut could escalate falling prices. The interest rate decision will be held on Tuesday, the 10th of December at 04:30 CET.

– US Consumer Price Index – Consumer prices have started to resume slight upside momentum recently. Should markets face a further increase in prices this could be seen as positive for the Dollar. The Fed might not cut interest rates next week.

The EURUSD weekly chart shows, that the currency pair has been trading on top of the psychological 1.0500 support zone. Only a break of this zone might hence ignite further upside momentum. Currently the markets looks like it would continue t trade towards the 1.0800 resistance area. The data will be published on Wednesday, 11th December at 14:30 CET.

– CA Interest rate decision- The Canadian Dollar is showing weakness against most other currencies. In particular the EURCAD currency pair shows strong upside momentum.

The daily chart above shows strong positive market sentiment. A potential continuation pattern might unleash upside potential towards the 1.5150 area. Only if the market breaks the support zone at 1.4870 downside potential might occur. Yet, another rate cut, as it is expected this month, might cause the CAD to lose momentum even further. The interest rate decision will be held on Wednesday, 11th December at 15:45 CET.

– EU Interest rate decision- It is expected that the European Central Bank will cut rates also during this meeting by 25 basis points.

Based on the weekly chart the EURJPY currency pair might offer further downside momentum. Recently, the market broke the important 50- moving average, which might indicate that the downside potential will increase. Below the 156.00 zone, the selling pressure might increase. Only a break of the 50- moving average would offer fresh upside momentum. Since the upcoming rate- cut is expected, the press conference might offer further insights and hence causing volatility in this market. The interest rate decision will be held on Thursday, 12th December at 14:15 CET.