EUR/USD Daily Forecast – Euro Is Flat Against U.S. Dollar At The Start Of The WeekEUR/USD is testing the resistance level at 1.2175.
EUR/USD Video 25.01.21.
Euro Tries To Move Higher Against U.S. Dollar
EUR/USD is currently trying to settle above the resistance at 1.2175 while the U.S. dollar remains under pressure against a broad basket of currencies.
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The U.S. Dollar Index is currently moving towards the nearest support level at 90. A successful test of this level will open the way to the test of the next support at 80.75 which will be bullish for EUR/USD.
The recent Euro Area PMI data was a bit better than expected as Manufacturing PMI decreased from 55.2 in December to 54.7 in January compared to analyst consensus of 54.5 while Services PMI decreased from 46.4 to 45 compared to analyst consensus of 44.5. Numbers below 50 show contraction.
Today, foreign exchange market traders will focus on Biden’s $1.9 trillion coronavirus aid package proposal. The proposal faced opposition from some Republicans due ot its huge size. However, markets believe that it would get enough support so riskier assets enjoy solid demand while safe-haven assets like the U.S. dollar are under pressure.
EUR/USD managed to get above the resistance at the 20 EMA at 1.2165 and is trying to settle above the next resistance level at 1.2175. EUR/USD has already made several attempts to settle above this level in recent trading sessions but failed to develop sufficient upside momentum.
In case EUR/USD settles above the resistance at 1.2175, it will move towards the next resistance level at 1.2220 although it may also face some resistance near 1.2190. A successful test of the resistance at 1.2220 will open the way to the test of the next resistance level which is located at 1.2250.
On the support side, the previous resistance at the 20 EMA at 1.2165 will likely serve as the first support level for EUR/USD. In case EUR/USD declines below the 20 EMA, it will move towards the next support level at 1.2155.
A move below the support at 1.2155 will push EUR/USD towards the next support at 1.2130. If EUR/USD manages to settle below this level, it will get to the test of the 50 EMA at 1.2120.
For a look at all of today’s economic events, check out our economic calendar.