EUR/USD pares gains after EU-UK trade deal, looks to close flat near 1.2180

EUR/USD lost its traction during the American trading hours.
Sharp drop in GBP/USD helped the greenback gather strength.
Market action is expected to remain subdued until next week.

Eren Sengezer FXStreet

The broad-based USD weakness allowed the EUR/USD pair to climb above 1.2200 during the European trading hours. However, the pair struggled to preserve its bullish momentum in the second half of the day and now remains on track to close virtually unchanged near 1.2180.

In the absence of significant macroeconomic data releases on Christmas Eve, Brexit headlines ramped up the market volatility. Reports of an imminent UK-EU trade deal fueled an impressive rally in the GBP/USD pair and made it difficult for the USD to attract investors.

After dropping to a daily low of 90.15, the US Dollar Index (DXY) staged a rebound during the American session and forced EUR/USD to erase its daily upside.

The confirmation of the EU-UK trade deal triggered a "sell the fact" market reaction and the DXY turned flat on the day 90.37.

GBP/USD drops back towards 1.3550 in “sell the fact” reaction to Brexit deal announcement.

EU's Barnier: UK trade deal will be put to EU Council, EU parliament.

Breaking: EU's von der Leyen says trade deal with UK is fair, balanced and right.

UK PM Johnson: There will be parliamentary vote on EU trade deal on December 30.

Technical levels to consider

EUR/USD

Overview
Today last price	1.2182
Today Daily Change	-0.0014
Today Daily Change %	-0.11
Today daily open	1.2196

Trends
Daily SMA20	1.2119
Daily SMA50	1.1928
Daily SMA100	1.1863
Daily SMA200	1.1498

Levels
Previous Daily High	1.2221
Previous Daily Low	1.2154
Previous Weekly High	1.2273
Previous Weekly Low	1.2116
Previous Monthly High	1.2003
Previous Monthly Low	1.1603
Daily Fibonacci 38.2%	1.2195
Daily Fibonacci 61.8%	1.218
Daily Pivot Point S1	1.2159
Daily Pivot Point S2	1.2123
Daily Pivot Point S3	1.2092
Daily Pivot Point R1	1.2226
Daily Pivot Point R2	1.2257
Daily Pivot Point R3	1.2293

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

GBP/USD climbs to four-day highs near 1.3250

GBP/USD rapidly reverses Friday’s small losses and challenges the 1.3250 level, or four-day tops, at the beginning of the week. Cable’s upside comes on the back of further loss of momentum in the Greenback, while traders continue to assess the geopolitical front and upcoming key events.

EUR/USD extends the advance past 1.1400

EUR/USD starts the week on a positive note, trading above 1.1400 on Monday as broad-based US Dollar weakness lends support to the pair. In the meantime, investors continue to monitor developments surrounding efforts to end the US-Iran conflict, while attention gradually shifts to the ECB's annual forum and the US NFP data.

Gold falters just ahead of $4,100

Gold remains under modest bearish pressure just above the key $4,000 mark per troy ounce on Monday. The yellow metal struggles to extend its recent gains as renewed effervescence in the Middle East revives inflation concerns and bolsters Fed rate hike expectations.

Bitcoin four-year cycle: BTC risks 75% drawdown with four months of bear market still ahead

Bitcoin price continues to trend downward below the $60,000 support zone after losing over 50% of its value since the $126,199 high in October. Bitcoin’s four-year cycle, measured from cycle tops to bottoms, suggests that four months of a bear market are still ahead.

Just like Fed, is BoJ’s independence under threat?

When talking about central bank independence, most of the focus has been on Donald Trump’s pressure on the Federal Reserve. But a similar story, a quieter one for now, seems to be happening on the other side of the Pacific: Japan’s government may be testing the Bank of Japan’s independence.

Kevin Warsh isn't expected to say much in Sintra: That's exactly why markets will listen

Financial markets could find an important catalyst in the enchanting, fairytale-like landscape of Sintra this week. The ECB Forum will, as it does every year, gather the crème de la crème of central banks. The new boss at the Fed, who has clearly said that the Fed should stop explaining everything, will need to talk – and traders should listen.