The end of the year is here, and it’s a great time to look back and review what drove markets in 2014. This little action and what to look for into early 2015 and further.
The biggest mover on the dashboard is the US Dollar as it is making important breaks against majors like USDJPY, EURUSD, USDCAD, USDCHF, GBPUSD, etc.
On the EURUSD pair, if you look at the previous weekly close we had last Friday, and you draw a trendline on the weekly chart from the 1.18 something lows to the 1.20 something lows, you will see that the trend line is broken right here, right now, with this last weekly close. Meaning last Friday, after Christmas.
Such a break bears a lot of consequences as, looking at the same time frame, one can conclude that a triangle that was acting as a reversal pattern just broke the b-d trend line and the outcome there is known for even the novice trader.
Moving onto other pairs, the view is not that different.
The USDCAD just broke this year out of a monthly contracting triangle and now that the b-d trend line is broken, we should see more squeeze to come into and above the 1.18 level, with the pair flirting with the 1.20 level sooner rather than later.
The USDCHF is just below parity, trading below 0.99 but for a pair that traveled so much and with negative interest rates SNB (Swiss National Bank) imposed, it is not out of the question to look for higher values for the pair and, of course, moves above parity to come.
And just like that, 2014 proved to be an interesting year, as we’re heading into 2015 with quite a few levels to watch for:
1.20 in EURUSD;
1.20 in EURCHF;
1.20 in USDCAD;
1.00 in USDCHF;
1.20 in USDJPY
Looking at the quotes above, one cannot ignore the coincidence and say this is just random.
Is there something in store for 2015 that we don’t already know?
I would say no. We just need to be objective. And being objective means to look at the other side of the Atlantic Ocean, as the US economy is growing bigger and bigger while others, while not necessarily stagnating, are imposing zero or, more fashionable, negative interest rates.
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Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
