Two trades to watch: EUR/USD tests 1.2250, TW as house prices rise 7.5% YoY
Fiona Cincotta December 30, 2020 8:55 AM
EUR/USD tests 1.2250 & holds uptrend in thin holiday trade ahead of mid tier US data later today. House builder Taylor Wimpey is on the rise after Nationwide reported 7.5% YoY house price growth.
EUR/USD holds uptrend
Technically, the pair trades comfortably over its 20,50 & 100 sma a bullish chart suggesting that more upside could be on the cards. Furthermore, the 20 sma has crossed above the 50 sma in another bullish signal.
On the upside, a move towards the round number 1.23 could be eyed prior to 1.245
Learn more about trading forex.
Where next for Taylor Wimpey as house price rise?
According to Nationwide, UK house prices climbed 7.5% in 2020 the highest growth rate in 6 years after demand was buoyed by the Chancellor’s stamp duty holiday, furlough scheme and changing preferences amid the pandemic.
However, the outlook is much more uncertain, depending on how the pandemic evolves and the economic scaring suffered. Whilst the stamp duty holiday continuing until March means prices could continue to increase in Q1, rising unemployment is the obvious risk.
Taylor Wimpey rallied hard in early November on vaccine optimism hitting a high of 172 before trending lower from mid November to 23rd December. The stock broke out of its descending channel scaling to 176 on 24th December after the Brexit deal announcement.
The pair trades above its 20, 50 & 100 sma in a bullish sign although has failed to find acceptance above 172 which acts as the immediate resistance prior to 176 and the 9 month high of 180p.
163/1 offers important support with 20 sma and upper band of the descending channel. A break through there sees more support at 160/59 50 & 100 sma, prior to horizontal support at 155.
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.