Sun, Dec 04, 2022 @ 08:49 GMT
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Daily Technical Analysis: US Dollar Continues Downtrend After Fed Leaves Rates Unchanged

Currency pair EUR/USD

As expected the Federal Reserve (Fed) left the interest rates unchanged for the US, which caused the US Dollar to weaken against multiple currencies, including the Euro. Prior to the FOMC statement in the US, the EUR/USD retraced back to the 23.6% Fibonacci level of wave 4 vs 3 but price bounced strongly soon after. The EUR/USD has now reached the 1.1750 resistance level and a break above it could see price challenge the Fibonacci targets of wave 5 vs 1+3.

The EUR/USD completed a wave 4 (orange) retracement and is now building strong bullish momentum. This is probably part of a wave 3 (grey) within wave 5 (orange). Once the wave 3 is completed, it is likely to see a wave 4 and 5 (grey) continuation.

Currency pair USD/JPY

The USD/JPY respected and bounced at the Fibonacci levels of wave 4 (orange) and the resistance from the previous top (red). The bearish turn is most likely part of the wave 5 (orange).

The USD/JPY could move towards the round level of 110 once price breaks below the bottom (green).

Currency pair GBP/USD

The GBP/USD broke above the resistance trend lines (dotted orange/red) with strong bullish momentum. This makes a bullish wave structure more likely and price could be heading towards the Fibonacci targets of wave 5 vs 1+3.

The GBP/USD seems to be in a wave 3 (grey) breakout. Price needs to reach the 161.8% Fibonacci target before confirming the development of a wave 3.

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