EUR/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Following the break of long-term trendline resistance (1.6038) in July, and subsequent break of supply from 1.1857/1.1352 in August (2020), a modest correction surfaced. However, buyers making an entrance in November and December (registering fresh multi-month highs) reasons additional upside towards ascending resistance (prior support – 1.1641) may be on the horizon.

The primary uptrend has been in play since price broke the 1.1714 high (Aug 2015) in July 2017.

Daily timeframe:

Partly modified from previous analysis –

Recent developments on the daily chart shows price action reached the descending wedge pattern’s (1.2011/1.1612) take-profit target at 1.2318 (yellow). Next on tap in terms of resistance is the bullish flag’s (1.2177/1.2078) take-profit level at 1.2384 (purple).

Trend on this timeframe remains decisively north, launching a series of higher highs and higher lows since March 2020 (secondary trend). However, the RSI also merits attention, with the value producing bearish divergence around overbought territory.

H4 timeframe:

March 2018 supply from 1.2385/1.2346 stepped forward on Wednesday, capping upside efforts. Traders may also want to note this supply grips the daily bullish flag’s take-profit level at 1.2384 within its upper range.

1.2255 support lies south of the zone, accompanied by a trendline support (1.1602).

H1 timeframe:

Wednesday aggressively spiked through 1.23 support, tripping stops and testing the 100-period simple moving average (the move also missed demand fixed at 1.2245/1.2258 by a hair).

As we head into the last hour of trading on Wednesday, the pair maintains a bullish position above 1.23, following a swift retest at the aforementioned level.

1.2350 resistance is next on tap should buyers remain at the wheel.

Observed levels:

The lacklustre response from H4 supply at 1.2385/1.2346 and H1 reclaiming 1.23+ status, along with daily price displaying room to approach 1.2384 and monthly calling for higher levels, suggests buyers have the upper hand at least until H1 confronts 1.2350 resistance (also represents the lower side of H4 supply at 1.2346).

AUD/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

December traded higher by nearly 5 percent, following November’s 4.5 percent rebound from demand at 0.7029/0.6664 (prior supply), consequently wrapping up 2020 in positive territory.

Interestingly, buyers, according to the monthly chart, appear free to explore as far north as 0.8303/0.8082 in the coming months, a supply zone aligning closely with trendline resistance (prior support – 0.4776).

In terms of trend, the primary downtrend (since mid-2011) remains south until breaking 0.8135 (January high [2018]).

Daily timeframe:

Wednesday extending recovery gains off support at 0.7647, this, in agreement with the prevailing uptrend (since March 2020), throws a light on supply at 0.7937/0.7890.

Despite the spirited advance, RSI enthusiasts will note bearish divergence continues to form inside overbought space.

H4 timeframe:

0.7805 resistance captured some of Wednesday’s limelight, following a decisive 0.7752 support retest.

As suggested by the higher timeframes, sellers have so far offered a non-committal tone around 0.7805, implying 0.7843 resistance could soon make an entrance.

H1 timeframe:

0.78 is centre stage on the H1 chart, a struggling resistance on the brink of giving way. This, on the strength of the higher timeframe picture, could unleash additional buying towards at least 0.7850 resistance.

Observed levels:

In a similar manner to recent analysis, we have monthly and daily price eyeing higher terrain, though H4 and H1 are seen flirting with resistances around 0.78.

A H1 close above 0.78 could trigger a short-term bullish scene, with 0.7843 H4 resistance and 0.7850 H1 resistance targeted.

USD/JPY:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Over the span of four years, USD/JPY carved out a descending triangle pattern between 118.66/104.62.

As you can see, though, December, down by 1 percent, pursued terrain south of 104.62.

104.62 ceding ground throws light on support from 101.70, with a break uncovering trendline support (76.15) and the descending triangle’s take-profit level at 91.04 (red).

Daily timeframe:

Support at 103.08 collapsed under the pressure of Tuesday’s push, with Wednesday retesting the breached level as resistance. Assembling a bearish stance here is likely to shift eyes towards demand at 100.68/101.85, an area containing monthly support at 101.70.

RSI followers will observe the value modestly rebounded from just above oversold, though has had upside capped by 57.00 resistance since July.

H4 timeframe:

Risk-on flows observed traders ditch the safe-haven Japanese yen on Wednesday, causing a convincing advance to tops just ahead of supply from 103.46/103.58 (representing a zone where a decision was made to break numerous local lows between 103.19/103.40).

The correction formed thereafter has seen the pair welcome 102.95/102.82, a newly formed supply-turned demand (another important decision point formed prior to breaking through Monday’s low).

H1 timeframe:

As we transition into Thursday, H1 is engaging 103 support, accompanied by the 100-period simple moving average.

Price action suggests a lack of demand south of 103, with 102.50 calling for attention should 103 fail to hold. Supply at 103.39/103.26 remains a point of interest, as does the 103.50 resistance plotted just north of it.

RSI action is currently toying with the upper side of 50.00, after having peaked around 77.00.

Observed levels:

Having seen monthly price showcase room to explore deeper water until support at 101.70, on top of daily price retesting resistance at 103.08, the H4 demand at 102.95/102.82 is unlikely to yield much upside. This also implies H1 may be on the verge of digging through 103 liquidity, which could spark intraday bearish flow towards the 102.50 support.

GBP/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

December ended higher by 2.5 percent, elevating GBP/USD to fresh multi-month highs and stirring trendline resistance (2.1161).

In terms of trend, however, the primary trend has faced lower since early 2008, unbroken (as of current price) until 1.4376 gives way – April high, 2018. In fact, the aforesaid high represents the next upside target on the monthly chart.

Daily timeframe:

Brought forward from previous analysis –

Besides Wednesday’s rudderless position, establishing an indecision doji candlestick, GBP/USD’s technical picture remains unchanged.

Resistance at 1.3755 is a key level to be aware of on the daily chart, stationed below supply at 1.3996/1.3918. A sell-off, on the other hand, projects light on support at 1.3176.

The RSI reveals a rangebound environment, limited by support around 47.00 and resistance at the 66.00 region.

H4 timeframe:

Demand at 1.3527/1.3556 successfully withstood downside pressure on Wednesday. This comes after Monday saw sellers greet resistance at 1.3711 and the two Fib projection levels around 1.3700.

Drifting through the aforesaid demand gestures a possible continuation to demand at 1.3401/1.3446 (aligns with a 161.8% Fib projection at 1.3441).

H1 timeframe:

Late US Wednesday saw buyers and sellers square off between 1.36 support and the 100-period simple moving average (serving as resistance around 1.3622), following an earlier recovery from 1.3550 support). Territory above the said moving average points to possible resistance at 1.3671 and 1.37.

Observed levels:

The break of monthly trendline resistance is likely to excite longer-term GBP longs, with daily price validating the move until resistance at 1.3755 and supply at 1.3996/1.3918. This supports further buying off H4 demand at 1.3527/1.3556, though a dip to H4 demand at 1.3401/1.3446 is, of course, not out of the question.

A break above the 100-period simple moving average on the H1 helps confirm bullish intent to at least H1 resistance at 1.3671 and maybe 1.37 (essentially causing H4 price to also revisit resistance around the 1.3711 zone).

DISCLAIMER:

The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including applicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.