EUR to USD Forecast
The most liquid FX pair EURUSD shows a bullish outlook across all binary options brokers the Euro Stoxx50 Index gapped up at this weeks’ open.
Circulation of the coronavirus vaccine is top on the list of news hitting the headlines, and traders already see the impacts on the price of the global stock market and currencies.
Let’s look into the news and technical chart patterns on the EURUSD.
Eurozone Industrial Production
It gauges the industrial sector’s output (Utilities, manufacturing, mining) and its impact on the economy.
Traders track it to project the GDP and economic health in the future.
The macroeconomic data continues its increase after its lowest low on June 12, 2020, where it recorded -28.7%.
Since then, the last reading was at -3.8%, and a higher value than forecast will be confident for the Euro.
A member of the ECB Exec BoardIsabel Schnabel’s speech on December 14, 2020, often hints at monetary policies, and traders pay close attention and anticipate the strength of the Euro.
Eurozone Manufacturing PMI
The Manufacturing PMI continues to record higher readings since its lower values (33.4) on May 04 and 21, 2020.
The last two months have been slowing months for the indicator, and further lows may send negative sentiments towards the Euro.
Lastly, traders look forward to an active EURUSD ahead of the Eurogroup meetings coming up on December 16, 2020.
US Mortgage Market Index
The MBA index has been upward but starts slowing after a sharp rally to 11721 on March 11, 2020.
It shows all mortgage applications (fixed-rate mortgage, government application, conventional applications, and adjustable rates).
US Markit Composite PMI
The indicator has been in a bullish state from May 21, 2020, till December 03, 2020, with a high reading of 58.6.
A higher reading shows an improving US economy.
EURUSD Technical Analysis
Weekly Chart Bullish
Considering the weekly chart overhead, we can see how big market players took their long positions while the EURUSD exchange rate traded within the MA20 and MA10.
Now that the price has broken above the 1.20114 resistance, we expect the bulls to start locking in profit, a move that may consequently lead to the exchange rate moving lower towards the MA10, where we can consider reentering into the upward trend as our bias remains bullish.
EURUSD Mid-Term Projections: Bullish
Daily Resistance: 1.21767
Daily Support: 1.16224, 1.17456, 1.18003, 1.20591
The Bullish trend from the daily time frame starts after the EURUSD exchange rate exits the oversold area on November 02, 2020, and entered the overbought zone on November 05, 2020.
Notice that the pair has not gone below the oversold area ever since it exited the zone on November 02, 2020.
The price touching the MA10 on November 12, November 22, and December 09 served as bullish trend re-entry spots.
Conclusion and Weekly Price Objectives
Announcement of COVID-19 vaccine distribution across the US brings positive sentiment to the Greenback, making it hold its own against Gold XAUUSD and reflecting the same optimism across all global economies.
A bullish monthly view of the EURUSD against a bearish USD Index (DXY) shows that the EUROZONE is currently the winner in the race against the Coronavirus of 2020.
However, the daily time frame suggests bullish intraday momentum. A correction of the EURUSD is anticipated in the coming weeks.
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