EUR/USD Daily Forecast – Resistance At The 20 EMA Stays Strong

Euro Is Losing Ground Against U.S. Dollar

EUR/USD is currently trying to settle back below the support at 1.1270 while U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index is trying to get to the test of the resistance level at 96.70. A move above this level will open the way to the test of the resistance at 97 which will be bearish for EUR/USD.

Yesterday, EU released the flash reading of Euro Area Consumer Confidence report which indicated that Euro Area Consumer Confidence declined from -6.8 to -8.3 compared to analyst consensus of -8.

Today, foreign exchange market traders will focus on the economic data from U.S. Analysts expect that CB Consumer Confidence improved from 109.5 in November to 110.8 in December despite worries over the spread of the new variant of coronavirus.

Existing Home Sales are expected to increase by 2.7% month-over-month in November after growing by 0.8% in October. The final reading of the third-quarter GDP Growth Rate report is projected to show that GDP increased by 2.1% quarter-over-quarter.

It remains to be seen whether economic reports will have a significant impact on EUR/USD dynamics as trading activity will likely decrease ahead of Christmas.

Technical Analysis

EUR/USD failed to settle above the 20 EMA at 1.1295 and is currently trying to settle back below the support level at 1.1270.

In case this attempt is successful, EUR/USD will gain additional downside momentum and head towards the support level at 1.1230. A move below this level will push EUR/USD towards the support at 1.1200.

On the upside, a move above the 20 EMA will open the way to the test of the next resistance level which is located at 1.1330. If EUR/USD gets above this level, it will head towards the resistance at 1.1350. A successful test of the resistance at 1.1350 will push EUR/USD towards the next resistance which is located near the 50 EMA at 1.1370.

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