- The euro cuts weekly gains against the US dollar on Friday.
- EUR / USD is heading towards the highest weekly close since then.
The pair EUR/USD it fell during the US session amid risk aversion and as the US dollar made a modest recovery. The pair fell to 1.2224, reaching a new daily low. Despite Friday’s slide, it maintains weekly gains while keeping upside potential intact.
The pullback from multi-year highs in EUR / USD so far looks like a correction. The next support area could be seen at 1.2200 and below at 1.2170. A dip below 1.2050 could suggest some exhaustion to the upside. The 1.2240 area is now the immediate resistance followed by the weekly high at 1.2270 / 75.
Technicians offered a boost to the EUR / USD pair during the week. The key factor was the fall of the US dollar. The DXY rose on Friday, trading above 90.00, poised to record the lowest weekly close since April 2018.
Risk appetite abated on Friday and favored the correction of the US dollar. Before the New Year, the trading volume will likely trend downward. Volatility could start to rise, considering that it has been rising slowly over the last few weeks, risk events like Brexit and the increased chances of sudden movements triggered by the low-volume environment.
Technical levels
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