EUR/USD Daily Forecast – Euro Tries To Rebound After Yesterday’s Pullback

EUR/USD Video 10.11.20.

Euro Gains Ground Against U.S. Dollar

EUR/USD received support near 1.1800 and is trying to get back above the resistance at 1.1830 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index has settled above the resistance at 92.50 but did not manage to get above the next material resistance level at 93 and pulled back. If the U.S. Dollar Index moves above the resistance at 93, it will gain additional upside momentum which will be bearish for EUR/USD.

Today, EU will provide the Euro Area ZEW Economic Sentiment Index for November which is expected to decline from 52.3 to 36. This report may have a meaningful impact on EUR/USD trading dynamics as it will highlight the magnitude of the blow dealt to economic sentiment by lockdowns in Europe.

Yesterday, vaccine news boosted the world markets but also put pressure on hopes for a new round of U.S. economic stimulus. As a result, the U.S. dollar was able to move higher against a broad basket of currencies.

In the recent trading sessions, the yield on U.S. government 10-year bonds increased from 0.72% to 0.97% before pulling back towards 0.92%. This rally in yields provided support to the U.S. dollar, but it remains to be seen whether the bond market will be able to stay at current levels.

Technical Analysis

EUR/USD is currently trying to settle above the nearest resistance level at 1.1830. If this attempt is successful, EUR/USD will move towards the next resistance level at 1.1880.

A successful test of the resistance at 1.1880 will open the way to the test of the major resistance level at 1.1910. Yesterday, EUR/USD made an attempt to settle above this level but faced strong resistance and pulled back towards 1.1800.

In case EUR/USD manages to settle above 1.1910, it will gain upside momentum and head towards the next resistance 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 nearest support level for EUR/USD has emerged at 1.1800. If EUR/USD declines below this level, it will get to the test of the next support level at the 20 EMA at 1.1785.

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