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EUR/USD Forecast: Turned Bullish In The Near-Term, Faces Resistance In The 1.1800/10 Area

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EUR/USD Forecast: Turned Bullish In The Near-Term, Faces Resistance In The 1.1800/10 Area

EUR/USD Current Price: 1.1770

  • Hopes that US authorities may reach a coronavirus aid package weighed on the greenback.
  •  ECB’s President Christine Lagarde and Fed’s Chair Jerome Powell refrained from mentioning monetary policy.
  • EUR/USD has turned bullish in the near-term, faces resistance in the 1.1800/10 area.

The EUR/USD pair traded as high as 1.1793 this Monday, with the positive risk sentiment getting a boost from Chinese data indicating economic growth, and speculation about a US fiscal stimulus package.  About this last, however, there are no news indicating progress, but House Speaker Nancy Pelosi announced Democrats had set a 48-hour deadline to clinch a deal.  The greenback maintained its sour tone across the FX board despite Wall Street being unable to hold on to early gains and turned red mid-US afternoon.

The macroeconomic calendar had little to offer. ECB’s President Christine Lagarde and Fed’s Chair Jerome Powell participated in different virtual events but made no relevant comments related to the current monetary policy. This Tuesday, Germany will publish the September Producer Price Index, while the US will release September Building Permits and Housing Starts for the same month. In general, the calendar will be light this week, which means the focus will remain on stimulus and other pandemic-related issues, and Brexit.

EUR/USD Short-Term Technical Outlook

The EUR/USD pair is holding on to most intraday gains and trading in the 1.1770 price zone after Democrats indicated that trade negotiations are still far apart in “values.”  The risk is skewed to the upside in the short-term, as, in the 4-hour chart, it is developing above all of its moving averages, which anyway lack clear directional strength. Technical indicators have partially lost their bullish momentum, but remain well above their midlines. The pair needs to take the 1.1810 resistance to be able to extend its advance during the upcoming sessions.

Support levels: 1.1725 1.1680 1.1640

Resistance levels: 1.1810 1.1850 1.1890

View Live Chart for the EUR/USD

Image sourced from Pixabay

 

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