EUR/USD Daily Forecast – Euro Tries To Gain Ground Against U.S. Dollar
EUR/USD Video 12.01.21.
Euro Rebounds After Yesterday’s Sell-Off
EUR/USD is trying to get back above 1.2155 while the U.S. dollar is mostly flat against a broad basket of currencies.
The U.S. Dollar Index is currently trying to settle below the nearest support level at 90.50. If this attempt is successful, the U.S. Dollar Index will gain downside momentum and head towards the next support level at the 20 EMA at 90.25 which will be bullish for EUR/USD.
In absence of important economic reports, foreign exchange market traders will likely focus on rising U.S. Treasury yields and general market sentiment. Rising yields have provided support to the U.S. dollar but it remains to be seen whether the recent rebound will be sustainable.
Democrats will likely introduce another stimulus package after Biden enters office, and it is not clear whether the U.S. dollar will continue to enjoy the support from rising yields amid a new round of money-printing.
EUR/USD is currently trying to get back above the resistance level at 1.2155. If this attempt is successful, EUR/USD will get to the test of the next resistance level at 1.2175.
A successful test of the resistance at 1.2175 will open the way to the test of the resistance at the 20 EMA at 1.2205. If EUR/USD manages to settle above the 20 EMA, it will gain additional upside momentum and head towards the next resistance at 1.2220.
On the support side, the nearest support level for EUR/USD has emerged at 1.2130. In case EUR/USD declines below this level, it will move towards the next support at the 50 EMA at 1.2110.
A move below the 50 EMA will be a negative development for EUR/USD bulls as it will signal that EUR/USD is ready to gain additional downside momentum. RSI remains in the moderate territory so there is plenty of room to gain momentum in case the right catalysts emerge.
If EUR/USD settles below the 50 EMA, it will head towards the next support level at 1.2080. A move below this level will push EUR/USD towards the support at 1.2060.
For a look at all of today’s economic events, check out our economic calendar.