Daily Technical Analysis December 28th 2023

1. EUR/USD Analysis: 

News Summary: 

The euro rose to its highest level since the end of July as the Federal Reserve signaled a shift toward interest rate decrease, continuing to boost risk appetite. However, economic analysis shows that the European Central Bank is more likely to cut interest rate than FED, the US economy may grow faster and more resiliently than the euro zone, and the situation on both sides is relatively similar in term of inflation.  

Trend Analysis: 

We can see EUR/USD broke through the previous high and continued to fluctuate upward, gradually moving away from the 48 hours moving average. However, the MACD double line and energy bar began to show top divergence. The euro appears to be overbought, and with Germany's economy starting to slip, the risk of a regional recession appears much higher here than in the United States.  

Today's Key Price Levels: 

Key Support Levels: [1.1010] 

Key Resistance Levels: [1.1200] 

Pivot Points [1.1170]  

2. USD/JPY Analysis: 

News Summary: 

At December policy meeting, the Bank of Japan said it was necessary to maintain the current ultra-loose monetary policy, but some members called for more in-depth discussions on future large scale stimulus withdrawals. If wage inflation cycle strengthens and significantly improves prospects for sustainable achievement of the price target, the BOJ will consider changes to monetary policy.  

Trend Analysis: 

We can see USD/JPY failed to break through, it ran below 48 hours moving average on H4 chart. In addition, the MACD double line and energy column formed a dead cross. Overall, the market is likely to experience significant volatility as investors attempt to determine whether USD/JPY is still in an upward trend or is about to collapse.  

Today's Key Price Levels: 

Key Support Levels: [140.00] 

Key Resistance Levels: [143.00] 

Pivot Points [142.70]