Trading plan for EUR/USD and GBP/USD on 12/24/2020

There is no doubt that a script about a Brexit movie is being written somewhere in Hollywood. In particular, the endless negotiations on a trade agreement. It's been several years of negotiations, with unending postponements of deadlines, abrupt changes in the positions of the parties, attempts at blackmail, and more. In addition, Great Britain changes its prime minister several times and the fate of millions of people on both sides of the English Channel is at stake – literally life or death of both simple workers and pampered managers of multinational corporations depends on the results of all this

But most importantly, there are unconfirmed rumors that the negotiations finally ended successfully. It seems that London and Brussels have come to a compromise. The final stage of this whole saga should be the press conference of Boris Johnson and Ursula von der Leyen, which may take place today in the first half of the day. A successful completion of the negotiations is expected to be announced, although the approval of the House of Commons and the parliaments of the European Union countries is still needed. Nonetheless, it is unlikely that the Hungary parliament will act as an evil genius and ruin the results of many years at the very last moment, considering how long everything was agreed upon. This will be a plot twist if it happens. In general, the market is only busy waiting for the announcement of the successful conclusion of Brexit since the opening of the US session. After all, rumors began to appear just then and it was not just that the negotiations was announced to last all night. In short, we are waiting for the planned press conference, after which, the pound and the euro may well break annual records and increase.

Some macroeconomic data in the United States were published yesterday, but no one is interested. However, these data are actually not to be ignored, as they are very significant. Let's take orders for durable goods as an example, which suddenly rose by 0.9%, against the forecasted growth of 0.6%. Their growth clearly indicates a further growth in retail sales, and hence inflation.

On the other hand, the labor market, which has been causing more concern lately, is not slowing the pace of recovery. So, the number of initial applications for unemployment benefits declined from 892 thousand to 803 thousand, although an increase is forecasted to 905 thousand. At the same time, the number of repeated applications, which should have declined from 5,507 thousand to 5,490 thousand, fell to 5,337 thousand. In other words, the labor market is still recovering, which means there is no reason to expect stagnation.

The GBP/USD pair showed high activity due to the information flow. As a result, the quote soared above the level of 1.3550. The market is filled with speculative hype and it can be assumed that we will continue to follow the Brexit noise, where more impulse surge in the market will appear depending on the nature of the incoming information.

The EUR/USD pair shows less activity, but still follows the information flow. Based on the recent fluctuations, a full-fledged correctional movement was not observed in the market, instead there are outlines of a slowdown that can go into the flat range of 1.2150/1.2275.

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