Technical Outlook: EURUSD continues to maintain the sideways range with last week seeing price action posting a strong reversal off the support at 1.0367 to reach highs near 1.0600. Looking at how price action is forming on the 4-hour chart and the support that has formed near 1.0367, EURUSD is likely to consolidate into a descending triangle pattern which could indicate further weakness to come, unless price breaks out to the upside off the current minor support at 1.0538 – 1.0480. A reversal off this current support zone could see EURUSD attempt to push higher on a breakout from the falling trend line. However, apply caution as the Stochastics on the 4-hour time frame is currently moving out from the overbought levels indicating weaker momentum to the upside. Below 1.0480, expect EURUSD to attempt another decline to test support at 1.0367.
Fundamental Outlook: A slow week in the Eurozone will see the European Central Bank’s meeting minutes from December stand out. The minutes will be coming out later in the week and could shed light on policy maker’s discussions which eventually led to the ECB deciding to expand the timeline of the QE but with smaller purchases. On the economic front, data this week will see the German and French industrial production figures, both of which are expected to show a modest increase for November, while French CPI figures for December is expected to see a 0.3% increase, same as the month before.
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EURUSD Weekly Forex Forecast – 9th to 13th Jan 2017 – Bearish