EUR/USD Daily Forecast – Test Of Support At 1.1230

U.S. Dollar Tries To Gain More Ground Against Euro

EUR/USD is currently trying to settle below the support at 1.1230 while the U.S. dollar is little changed against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle above the resistance level at 96.50. In case the U.S. Dollar Index manages to settle above this level, it will gain additional upside momentum and head towards the next resistance at 96.70 which will be bearish for EUR/USD. RSI for the U.S. Dollar Index remains in the overbought territory, but the current upside trend looks strong.

Yesterday, EU reported that Euro Area Manufacturing PMI increased from 58.3 in October to 58.6 in November while analysts expected that it would decline to 57.3. Euro Area Services PMI grew from 54.6 to 56.6 compared to analyst consensus of 53.5.

Today, foreign exchance market traders will focus on the economic data from U.S. and the situation with coronavirus in Europe. Germany and France may be forced to introduce additional virus containment measures, which will hurt the European economy and may put more pressure on the European currency.

Technical Analysis

EUR/USD is testing the support level at 1.1230. RSI remains in the oversold territory, so the risks of a rebound are increasing. In case EUR/USD manages to settle below the support at 1.1230, it will head towards the next support level which is located at 1.1200.

A successful test of the support at 1.1200 will open the way to the test of the support at 1.1170. If EUR/USD declines below this level, it will move towards the next support level at 1.1150.

On the upside, the previous support at 1.1270 will serve as the first resistance level for EUR/USD. A move above this level will push EUR/USD towards the resistance at 1.1300.

In case EUR/USD manages to climb back above 1.1300, it will head towards the resistance at 1.1325. A successful test of this level will push EUR/USD towards the resistance at 1.1350.

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