Trading plan for 18/12/2017

The US Dollar bears a modest loss against other currencies, partially erasing the Friday's strengthening, which can be associated with excitement about getting closer to the end of the battle for the tax bill. The stock market is predominantly green as Tokyo Nikkei2225 increased by 1.6% and Chinese Hang Seng increased by 0.9%.

On Monday 18th of December, the event calendar is light in important events releases, but the market participants will keep an eye on Consumer Price Index Core data from Eurozone, Foreign Securities Purchases data from Canada and NAHB Housing Market Index data from the US.

EUR/USD analysis for 18/12/2017:

On Sunday, leading representatives of the Republican Party signaled that Congress this week passed a tax bill. The Senate will hold its vote at the earliest on Tuesday, and President Trump may receive a document for signature on Wednesday, although each deadline will be good by the end of the week (Friday is an unofficial boundary). USD and US bond yields conducted a mini-rally on Friday on the wave of preliminary speculation, although today the market is more controlled, because everyone realizes that politics can surprise in the least expected moment. Additionally, by the end of the week, congressmen will have to agree on a further extension of budget funding to avoid so-called "government shutdown". I do not think that there will be an unpleasant surprise in both cases, but the market seems to blow a little cold, which will limit the scale of Dollar fluctuations.

Let's now take a look at the EUR/USD technical picture at the H4 time frame. After a failure at the level of 61% Fibo at 1.1855, the market dropped back towards the level of 1.1725, but did not make it either. Currently, the price is hovering around the middle of the zone, testing the internal dashed trend line resistance at the level of 1.1792. No big developments in momentum have been noticed as well as all the moves are really not impressive.


Market Snapshot: Gold fails at the resistance

The price of Gold has failed to break out above the technical resistance at the level of $1,260 and got back to the consolidation at the level of $1,253. The overbought market conditions favor more bearish price action. The key level to the downside is technical support at the level of $1,250.


Market Snapshot: DAX out of the channel

The price of German DAX has broken out from the dashed channel and now is testing the technical resistance at the level of 13,254. The Head & Shoulders technical pattern is still valid, but the right shoulder is getting very extended in time. The key level to the downside remains at 12.809.


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