EUR/USD Daily Forecast – Test Of Resistance At 1.1800

EUR/USD Video 13.11.20.

Euro Tries To Continue Its Rebound

EUR/USD is trying to settle back above 1.1800 after an unsuccessful attempt to get below the major support at 1.1750 while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index lacks momentum today as traders are cautious with their bets ahead of the weekend. The recent surge in the number of new coronavirus cases in the U.S. has put some pressure on recent market optimism, and the yields on U.S. 10-year government bonds have declined from 0.98% to 0.87%.

In recent trading sessions, the rise in yields has provided some support to the American currency, and the pullback left traders puzzled about their next move.

Yesterday, EU reported that Euro Area Industrial Production declined by 0.4% month-over-month in September while analysts expected growth of 0.7%. On a year-over-year basis, Industrial Production decreased by 6.8% compared to analyst consensus which called for a decline of 5.8%. In all likelihood, the reports for October and November will look worse.

Today, traders will have a chance to take a look at the second estimate of the third-quarter Euro Area GDP Growth Rate. Analysts expect that third-quarter GDP Growth Rate will be 12.7% on a quarter-over-quarter basis.

Technical Analysis

EUR/USD is currently testing the nearest resistance level at 1.1800. If this test is successful, EUR/USD will move towards the next resistance level at 1.1830. This resistance level has been tested several times in recent trading sessions and proved its strength.

A move above the resistance at 1.1830 will open the way to the test of the next resistance level at 1.1880. In case EUR/USD manages to settle above this level, it will move towards the major resistance at 1.1910.

On the support side, the nearest support level for EUR/USD is located at the 20 EMA at 1.1785. If EUR/USD declines below this level, it will test the 50 EMA at 1.1770.  A move below the 50 EMA will push EUR/USD towards the major support at 1.1750. Most likely, EUR/USD will need additional catalysts to get through the support area at 1.1750 – 1.1800.

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