EUR/USD Daily Forecast – Euro Gains Ground After Yesterday’s Volatile Trading Session

EUR/USD Video 24.11.20.

U.S. Dollar Is Losing Ground Against Euro

EUR/USD failed to settle below the support at 1.1830 and is trying to settle above 1.1850 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index made an attempt to settle above the resistance at the 20 EMA at 92.80 after the release of better-than-expected U.S. PMI reports but lost upside momentum. Currently, the U.S. Dollar Index is trying to settle below the nearest support level at 92.50. If this attempt is successful, the American currency will face additional pressure on the foreign exchange market which will be bullish for EUR/USD.

Yesterday, EU reported that Euro Area Manufacturing PMI decreased from 54.8 in October to 53.6 in November compared to analyst consensus of 53.1. Euro Area Services PMI declined from 46.9 to 41.3 while analysts expected that it would decline to 42.5. Numbers below 50 show contraction.

The situation in the Euro Area services segment is very challenging due to lockdowns. Many anti-virus measures will remain in place in December so the services segment will remain under pressure until the end of this year.

Technical Analysis

EUR/USD managed to stay above the support at 1.1830 and is slowly moving towards the nearest resistance level at 1.1880. This resistance level has already been tested many times and proved its strength.

In addition, there is a major resistance at 1.1910 which has been tested during yesterday’s trading session, so EUR/USD must get above a strong resistance area at 1.1880 – 1.1910 to have a chance to develop upside momentum.

If EUR/USD gets above the resistance at 1.1910, it will get to the test of the next resistance level at 1.1965.

On the support side, the nearest support level for EUR/USD is located at the 20 EMA at 1.1830. A move below this level will push EUR/USD towards the next support at the 50 EMA at 1.1800. In case EUR/USD declines below 1.1800, it will get to the test of the next support level at 1.1780.

From a big picture point of view, EUR/USD is currently trading in a wide range between the support at 1.1800 and the resistance at 1.1910. Most likely, it will need additional catalysts to get out of this range.

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