Forex Forecast: 23 – 27/11/2020
How to use the basic technical analysis concepts we have shared with you to predict the next week’s currency pair price movement
EURUSD Rates Week in Review
Last week, our technical indicators suggested going short on the currency pair at or above 1.17777, setting a stop loss at 1.19, and to go long at or below 1.16357. As expected and throughout this week, the EURUSD traded sideways, ranging from 1.1895 to 1.1813. So this past Monday, we could have short the EURUSD on an intraday trading at 1.1869, covering it at 1.1813, realizing 0.47% ROI. Tuesday, we could have short it at 1.1895, covering it on an intraday trading at 1.1842, for 0.45% gain. Wednesday, we could have short it on an intraday trading at 1.1892, covering it at 1.1848, for a 0.37% profit, and today Thursday, we could have short it at 1.1853, closing the short position at 1.1817 for an extra 0.3% ROI.
The 1.19 neighbourhood is motivating sellers to return to the markets and drag spot back to the vicinity of the 1.18 mark in the second half of the week.
The unremitting advance of the pandemic and its impact on the growth prospects of the euro area and the rest of the world returns to the fore as the main driver for the price action, relegating at the same time the previous optimism that followed the news of the vaccine.
Also adding pressure to the single currency, fresh cracks emerge in the Old Continent in response to the potential vetoes from Hungary and Poland to the €1.8 trillion EU Recovery Fund. This issue is expected to be in the centre of the debate at the EU Council Video Conference on Thursday and carries the potential to re-ignite political effervescence among members and thus hurt the sentiment around the euro.
EURUSD is trading around 1.1830, marginally lower. ECB President Lagarde reiterated her commitment to monetary stimulus. AstraZeneca published promising results from its covid vaccine trial, while cases continue rising on both sides of the Atlantic.
Following the rejection from the 1.19 neighbourhood, the corrective downside in EURUSD could extend initially to last week’s lows in the 1.1750 region ahead of the contention area near 1.1700, where coincide the 100-day SMA and a Fibo retracement (of the 2017-2018 rally). The loss of this level could pave the way for a deeper pullback to the monthly lows near 1.16 (November 4). On the upside, 1.19 remains a tough nut to crack for EUR-bulls. If and when this level is cleared, then the attention should shift to the monthly peaks around 1.1920 (November 9) ahead of the August’s top at 1.1965.
For next week and as illustrated in the following EURUSD 4-hour chart, EURUSD, our technical indicators are suggesting to go short on the currency pair at or above 1.1846, setting a stop loss at 1.1918, and to go long at or below 1.16258.
As of 3:00 PM (GMT), the EURUSD was trading at 1.18317.
EUR to USD forecast for tomorrow: Euro to Dollar forecast on Friday, November, 20: exchange rate 1.1849 Dollars, maximum 1.2027, minimum 1.1671. EUR to USD forecast on Monday, November, 23: exchange rate 1.1854 Dollars, maximum 1.2032, minimum 1.1676. Euro to Dollar forecast on Tuesday, November, 24: exchange rate 1.1877 Dollars, maximum 1.2055, minimum 1.1699. EUR to USD forecast on Wednesday, November, 25: exchange rate 1.1903 Dollars, maximum 1.2082, minimum 1.1724.
In 1 week, Euro to Dollar forecast on Thursday, November, 26: exchange rate 1.1933 Dollars, maximum 1.2112, minimum 1.1754. EUR to USD forecast on Friday, November, 27: exchange rate 1.1889 Dollars, maximum 1.2067, minimum 1.1711. Euro to Dollar forecast on Monday, November, 30: exchange rate 1.1894 Dollars, maximum 1.2072, minimum 1.1716. EUR to USD forecast on Tuesday, December, 1: exchange rate 1.1835 Dollars, maximum 1.2013, minimum 1.1657. Euro to Dollar forecast on Wednesday, December, 2: exchange rate 1.1888 Dollars, maximum 1.2066, minimum 1.1710.
Disclosures: The material provided herein is for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any interests in the EUR/USD or any other securities. This overview may include or be based in part on projections, valuations, estimates and other financial data supplied by third parties, which has not been verified by Pedro Ferreira nor KeySoft. Any information regarding projected or estimated investment returns are estimates only and should not be considered indicative of the actual results that may be realized or predictive of the performance of the EUR/USD or any underlying security. Further, Pedro Ferreira is not long or short in the currency pair. Past investment results of any underlying managers should not be viewed as indicative of the future performance of the EUR/USD.