EURUSD Rates Week in Review

Last week, our technical indicators suggested to go Short on the EURUSD at or above 1.03, setting a Stop Loss at 1.045, and to go Long at or below 1.02, setting a Stop Loss at 0.985.

This week, EURUSD price range was 1.0449 high, set today Thursday, and 1.0223 low, set this past Monday. So, Monday, we could have short the currency pair at 1.0331, covering it on an intraday trading at 1.0225, for 1.03% profit. Tuesday, we could have short it at 1.0299, covering it on an intraday trading at 1.0244, for 0.53% profit. Wednesday, we could have short it at 1.0417, covering it on an intraday trading at 1.0299, for 1.13% profit. Thursday, we could have short it at 1.0447, covering it on an intraday trading at 1.0384, for an extra 0.6% ROI.

Fundamental Overview

European Central Bank (ECB) Vice President Luis de Guindos stated Wednesday, “It is very likely that we will see negative growth rates in the fourth quarter in the Eurozone.”  The policymaker also added that the ECB will keep raising interest rates to try to bring inflation down towards mid-term goals. Additionally, Germany’s central bank the Bundesbank released its monthly report and stated, “The inflation rate could stay in double digits also beyond the turn of the year.”

Talking about the preliminary activity data for November, Germany’s S&P Global/BME Manufacturing PMI improved to 46.7 versus 45.0 market forecasts and 45.1 while the Services counterpart came out as 46.4 compared to 46.2 expected and 46.5 previous readings.

On the other hand, Eurozone S&P Global Manufacturing PMI also rose to 47.3 for the said month from 46.4 prior and 46.0 consensus figure. That said, the bloc’s Services PMI reprinted 48.6 figure while crossing expectations of registering 48.0 number.

Moving on, the first readings of Germany’s IFO sentiment numbers for November will precede the ECB Monetary Policy Meeting Accounts, mostly known as ECB Accounts, to entertain EURUSD traders. Although likely upbeat statistics and the hawkish tone of the ECB Accounts may keep the quote firmer, signals of the recession may probe the upside momentum.

Technical Analysis

EURUSD holds above 1.0400 after German IFO data. The currency pair retreated modestly from the nine-day high it touched near 1.0450 but managed to stay in positive territory above 1.0400. The data from Germany showed that IFO Business Climate Index improved to 86.3 in November from 84.5 in October, helping the Euro hold its ground. US stock and bond markets will be closed due to the Thanksgiving Day holiday.

The EURUSD pair is aiming to establish comfortably above the 200-period Exponential Moving Average (EMA) at 1.0389. The corrective move in the asset after printing a high of 1.0482 to near 1.0226 has been supported by the upward-sloping trend-line placed from November low at 0.9730.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a bullish range of 60.00-80.00, which indicates more upside ahead. Should the asset break above November’s high at 1.0482, the major will be exposed to the horizontal resistances plotted from June 27 high at 1.0615 and May 30 high at 1.0787.

On the contrary, the shared currency bulls could lose strength if the asset drops below Monday’s low at 1.0226. This will drag the asset towards November 11 low at 1.0163, followed by the round-level support at 1.0100.

For next week, as illustrated in the following 3-hour chart, the Euro has formed an upward channel and is trading near its support line. In my humble opinion, once the price can break the resistance level , the price may continue to rise and grow to the resistance line of the channel. In this case, we would set two targets. The first target is at 1.0440, and the next target is at 1.0715 which coincides with the resistance line of the channel. Hence, our technical analysis are suggesting to go Short on the EURUSD at or above 1.0440, setting a Stop Loss at 1.0715, and to go Long at or below 1.04158, setting a Stop Loss at 1.02.

As of 13:30 PM (GMT), the EURUSD was trading at 1.04110.

EUR to USD forecast for tomorrow: Euro to Dollar forecast on Friday, November, 25: exchange rate 1.0502 Dollars, maximum 1.0660, minimum 1.0344. EUR to USD forecast on Monday, November, 28: exchange rate 1.0565 Dollars, maximum 1.0723, minimum 1.0407. Euro to Dollar forecast on Tuesday, November, 29: exchange rate 1.0489 Dollars, maximum 1.0646, minimum 1.0332. EUR to USD forecast on Wednesday, November, 30: exchange rate 1.0409 Dollars, maximum 1.0565, minimum 1.0253.

 

In 1 week, Euro to Dollar forecast on Thursday, December, 1: exchange rate 1.0409 Dollars, maximum 1.0565, minimum 1.0253. EUR to USD forecast on Friday, December, 2: exchange rate 1.0459 Dollars, maximum 1.0616, minimum 1.0302. Euro to Dollar forecast on Monday, December, 5: exchange rate 1.0483 Dollars, maximum 1.0640, minimum 1.0326. EUR to USD forecast on Tuesday, December, 6: exchange rate 1.0452 Dollars, maximum 1.0609, minimum 1.0295. Euro to Dollar forecast on Wednesday, December, 7: exchange rate 1.0610 Dollars, maximum 1.0769, minimum 1.0451.

 

 

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. 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 future performance of the EUR/USD.

 

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