EUR/USD Daily Forecast – Euro Starts The Week On A Strong Note

EUR/USD Video 16.11.20.

Euro Continues To Move Higher Against U.S. Dollar

EUR/USD has managed to get above the resistance at 1.1830 and is moving towards the next resistance level at 1.1880 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle below the nearest support level at 92.60. If the U.S. Dollar Index manages to settle below this level, it will likely gain additional downside momentum which will be bullish for EUR/USD.

On Firday, EU reported that Euro Area GDP Growth Rate was 12.6% quarter-over-quarter compared to analyst consensus of 12.7%. On a year-over-year basis, GDP declined by 4.4% while analysts called for a decline of 4.3%.

The recent economic data from Europe highlighted the slowdown of the European economy, but the foreign exchange market is more focused on the upcoming vaccines than on the current economic problems.

At this point, euro and other riskier currencies are gaining ground against the U.S. dollar on hopes that life will get back to normal within a reasonable timeframe. It remains to be seen whether  this upside move will be sustainable as recent virus data suggests that the situation with COVID-19 is still not moving in the right direction.

Technical Analysis

 

EUR/USD gained upside momentum and is trying to get to the test of the next resistance level at 1.1880. If EUR/USD manages to settle above this level, it will gain upside momentum and head towards the major resistance level at 1.1910.

In case EUR/USD gets above the resistance at 1.1910, it will head towards the next resistance level at 1.1965. A move above 1.1965 will push EUR/USD towards the psychologically important resistance level at 1.2000.

On the support side, the previous resistance at 1.1830 will serve as the first support level for EUR/USD. In case EUR/USD moves below this level, it will decline towards the 20 EMA at 1.1800.

A move below the 20 EMA will push EUR/USD towards the next support at the 50 EMA at 1.1775. If EUR/USD declines below this level, it will get to the test of the major support level at 1.1750.

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