Daily Forex Analysis - 11 December 2020

USD Overview (11 December 2020)

Yesterday, USD weakened against most major currencies except GBP and JPY.

The CPI m/m data released yesterday indicated an increase in the rate of inflation in November.

- CPI m/m (Actual: 0.2%, Forecast: 0.1%, Previous: 0.0%)

- Core CPI m/m (Actual: 0.2%, Forecast: 0.1%, Previous: 0.0%)

The PPI m/m data will be released later at 2130 (SGT).

- PPI m/m (Forecast: 0.1%, Previous: 0.3%)

- Core PPI m/m (Forecast: 0.2%, Previous: 0.1%)

Also, the Preliminary UoM Consumer Sentiment data (Forecast: 76.1, Previous: 76.9 revised from 77.0) will be released later at 2300 (SGT).

NZD/USD Outlook (11 December 2020)

Overall, NZD/USD is trending upwards.

Currently, NZD/USD is testing to break above the key level of 0.71. Its next support zone is at 0.70000 and the next resistance zone is at 0.72000.

Look for buying opportunities of NZD/USD if it breaks above the key level of 0.71.

AUD/USD Outlook (11 December 2020)

Overall, AUD/USD is trending upwards. Recently, AUD/USD broke above the key level of 0.75.

AUD/USDs next support zone is at 0.73900 and the next resistance zone is at 0.76800.

Look for buying opportunities of AUD/USD.

USD/JPY Outlook (11 December 2020)

Overall, USD/JPY is trending downwards.

Currently, USD/JPY is testing to break below the key level of 104. Its next support zone is at 103.400 and the next resistance zone is at 105.600.

Look for selling opportunities of USD/JPY.

EUR/USD Outlook (11 December 2020)

Overall, EUR/USD is trending upwards. Recently, EUR/USD broke above the key level of 1.21.

During the monetary policy meeting yesterday, the European Central Bank (ECB) recalibrated its monetary policy instruments. Some of the main points are:

- Interest rates were held unchanged.

- The limit of the Pandemic Emergency Purchase Programme (PEPP) has been increased by €500 billion to a total of €1,850 billion and the programme has been extended to at least the end of March 2022.

- The period of the Targeted Longer-Term Refinancing Operations (TLTRO III) has been extended to June 2022.

- Net purchases under the Asset Purchase Programme (APP) will continue at a monthly pace of €20 billion.

The Euro Summit will be held today. Also, day 2 of the EU Economic Summit will be held today. Expect volatility in EUR today.

Currently, EUR/USD is moving towards the resistance zone of 1.21800 and the next support zone is at 1.19800.

With the ongoing negotiation of the post-Brexit trade deal, look for short-term selling opportunities of EUR/USD if it bounces off the resistance zone of 1.21800.

GBP/USD Outlook (11 December 2020)

Overall, GBP/USD is ranging across. Recently, GBP/USD bounced off the support zone of 1.32200.

The UK GDP m/m data (Actual: 0.4%, Forecast: 0.4%, Previous: 1.1%) released yesterday indicated a slowdown in economic growth in October.

The Bank of England (BoE) will be releasing the Financial Stability Report later at 1500 (SGT).

BoE Governor Bailey will be holding a press conference on the Financial Stability Report later at 1630 (SGT).

Currently, GBP/USD is testing to break above the key level of 1.33. Its next support zone is at 1.32200 and the next resistance zone is at 1.34600.

With the ongoing negotiation of the post-Brexit trade deal, look for short-term selling opportunities of GBP/USD if it bounces down from the key level of 1.33.

USD/CAD Outlook (11 December 2020)

Overall, USD/CAD is trending downwards. Recently, USD/CAD broke the support zone of 1.27900.

Currently, USD/CAD is testing the support zone of 1.27900 and the next resistance zone is at 1.29800.

Look for selling opportunities of USD/CAD.

GBP/JPY Outlook (11 December 2020)

Overall, GBP/JPY is ranging across. Recently, GBP/JPY broke below the key level of 139.

The UK GDP m/m data (Actual: 0.4%, Forecast: 0.4%, Previous: 1.1%) released yesterday indicated a slowdown in economic growth in October.

The Bank of England (BoE) will be releasing the Financial Stability Report later at 1500 (SGT).

BoE Governor Bailey will be holding a press conference on the Financial Stability Report later at 1630 (SGT).

GBP/JPYs next support zone is at 137.500 and the next resistance zone is at 140.000.

With the ongoing negotiation of the post-Brexit trade deal, look for short-term selling opportunities of GBP/JPY.

EUR/JPY Outlook (11 December 2020)

Overall, EUR/JPY is trending upwards. Recently, EUR/JPY trended into the resistance zone of 126.700.

During the monetary policy meeting yesterday, the European Central Bank (ECB) recalibrated its monetary policy instruments. Some of the main points are:

- Interest rates were held unchanged.

- The limit of the Pandemic Emergency Purchase Programme (PEPP) has been increased by €500 billion to a total of €1,850 billion and the programme has been extended to at least the end of March 2022.

- The period of the Targeted Longer-Term Refinancing Operations (TLTRO III) has been extended to June 2022.

- Net purchases under the Asset Purchase Programme (APP) will continue at a monthly pace of €20 billion.

The Euro Summit will be held today. Also, day 2 of the EU Economic Summit will be held today. Expect volatility in EUR today.

Currently, EUR/JPY is testing the resistance zone of 126.700 and the next support zone is at 124.750.

With the ongoing negotiation of the post-Brexit trade deal, look for short-term selling opportunities of EUR/JPY if it bounces off the resistance zone of 126.700.