EUR/USD Price Forecast December 22, 2017, Technical Analysis

The EUR/USD pair pulled back slightly during the trading session on Thursday, reaching down to the 1.1850 level. That’s an area that has been resistance in the past, and now is starting act as support. When I look at the longer-term charts, specifically the weekly timeframe, I recognize that we have a nice bullish flag, and that could reach towards the 1.32 level longer term. Because of this, I have an upward bias when it comes to the EUR/USD pair, and I don’t have any interest in shorting. That would change if we can break down below the 1.17 level underneath, but quite frankly I don’t think that’s going to happen.

A break above the 1.20 level is significant, but even more importantly is a break above the 1.21 handle, which is the most recent high, and with signify that we are ready to go much higher. I believe that even though the United States has passed significant tax reform, it looks increasingly likely that the pair should continue to go higher, perhaps in more of a “risk on” move. Volatility will remain due to the time year, but I think that the smart money is starting to come in and put some positions on ahead of the new year. Typically, we will see volatility pick up after New Year’s Day, and that could be when we make the significant push to the upside.

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