EUR/USD Stuck In A Narrow Range
InstaForex Group | Dec 22, 2021 05:09AM ET
It is hardly surprising that the euro has almost come to a halt after successfully completing a local correction. Besides, the economic calendar was uneventful. At the moment, the fluctuations of the EUR/USD pair are very moderate, and it seems that nothing will change today.
At the same time, markets are waiting for the US GDP report for the third quarter. The actual reading is widely expected to meet the estimated data. So, the fact that economic growth in the US has slowed down to 2.1% from 6.7% is unlikely to surprise the market and has already been priced in.
The EUR/USD pair has been moving within a sideways channel of 1.1225/1.1355 for almost a month, indicating the accumulation of open positions. This situation gave rise to speculative trading which sometimes results in sharp price movements within the indicated range.
The RSI technical indicator is staying near 50 on the 4-hour time frame, confirming the flat movement. On the daily time frame, RSI is steadily holding at the bottom of the indicator. This serves as a signal for the continuation of the downtrend.
In the meantime, the downtrend prevails on the daily chart. Short-term flat trading found within the trend has slowed down bearish activity for some time.
h2 Outlook for EUR/USD/h2Market activity is extremely low today ahead of the Christmas holidays. This leads to a complete halt within the indicated sideways channel.
Yesterday was a good example of such trading as market participants got stuck in the narrow range of 1.1260/1.1303. The price may then exit the channel by accelerating towards one of its boundaries.
Comprehensive indicator analysis gives mixed signals on the short-term and intraday charts due to a sideways movement of the price. In the medium term, technical indicators confirm a downtrend and suggest selling the pair.
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