EUR/USD Daily Forecast – Euro Looks Strong At The Start Of The Week

EUR/USD Video 14.12.20.

Euro Moves Higher Against U.S. Dollar At The Beginning Of The Week

EUR/USD is moving towards the nearest resistance level at 1.2155 while the U.S. dollar is losing some ground against a broad basket of currencies.

The U.S. Dollar Index failed to settle above the resistance at the 91 level and is moving towards the nearest support level at the yearly lows at 90.50. The U.S. Dollar Index made several attempts to get to the test of this level in recent trading sessions but these attempts yielded no results. If the U.S. Dollar Index declines below 90.50, it will gain downside momentum which will be bullish for EUR/USD.

Today, EU will provide Euro Area Industrial Production report for October. Industrial Production is expected to grow by 2% month-over-month. On a year-over-year basis, Industrial Production is projected to decline by 4.4%.

Foreign exchange market traders will also continue to monitor Brexit news. EU and UK have once again agreed to extend the deadline on Brexit negotiations, and the market believes that the compromise deal will be reached.

Interestingly, EUR/USD showed little reaction to Brexit updates in recent trading sessions while GBP/USD was very volatile. However, the situation may change quickly when EU and UK announce the final results of negotiations.

Technical Analysis

EUR/USD continues its attempts to settle above the nearest resistance level at 1.2155. If EUR/USD manages to get above this level, it will head towards the next resistance at December highs at 1.2175.

A move above the resistance at 1.2175 will push EUR/USD towards the next resistance level at 1.2220. In case EUR/USD gets above the resistance at 1.2220, it will get to the test of the resistance at 1.2250.

On the support side, some support has emerged near 1.2110. A move below this level will push EUR/USD towards the next support level at 1.2090. If EUR/USD declines below this level, it will move to the next support at the recent lows at 1.2060.

It should be noted that EUR/USD has been consolidating in the range between the support at 1.2060 and the resistance at 1.2175 since early December, and volatility will likely increase once it manages to get out of this range.

For a look at all of today’s economic events, check out our economic calendar.