EUR/USD Forecast: Consolidating Around 1.1820, With The Risk Skewed To The Downside

EUR/USD Current Price: 1.1809

• German ZEW survey showed that Economic Sentiment plummeted in November.
• US stocks mixed as Monday’s euphoria about a coronavirus vaccine faded.
• EUR/USD is consolidating around 1.1820, with the risk skewed to the downside.

Financial markets took Tuesday to consolidate, with the greenback giving up some of the ground gained on Monday. The shared currency was among the weakest, falling against the greenback to a daily low of 1.1779 amid discouraging German data. The local ZEW Survey came in worse than anticipated, as the Economic Sentiment in the country contracted to 39 in November from 56.1 in the previous month, while the assessment of the current situation came in at -64.3, down from -59.5. For the EU, Economic Sentiment fell to 32.8.

Stocks’ markets momentum receded, and so did the dollar’s one, although the American currency holds near its weekly highs against all of its major rivals, amid prevalent optimism about a coronavirus vaccine and as US presidential election’s tensions have a lesser effect on currencies.

This Wednesday, the US celebrates a holiday, and while most markets will be opened, the country won’t release macroeconomic data. In the EU, the focus will be on the ECB, as President Christine Lagarde and other voting members will be on the wires.

EUR/USD Short-Term Technical Outlook

The EUR/USD pair is trading around 1.1810, finishing a second consecutive day above the 38.2% retracement of its latest bullish run at 1.1800, despite short-lived intraday slides below the level. The risk is skewed to the downside in the near-term, as the 4-hour chart shows that the pair spent the day below its 20 SMA, which loses bullish strength. The Momentum indicator is heading lower within negative levels, while the RSI is flat within negative levels. A bearish continuation seems likely on a break below the mentioned weekly low.

Support levels: 1.1780 1.1740 1.1695

Resistance levels: 1.1840 1.1885 1.1920

View Live Chart for the EUR/USD

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