EUR/USD Forecast: At fresh YTD highs and still advancing
EUR/USD Current Price: 1.2149
- Investors ignore tepid German data and continue to buy the shared currency.
- US employment-related data beat expectations ahead of the NFP report.
- EUR/USD is technically overbought but still bullish in the near-term.
The EUR/USD pair is trading at its highest since April 2018 in the 1.2150 price zone, as the dollar continues to weaken. The market keeps trying to find a balance after a fundamental revolution. Many headlines have reached desktops these days, related to Brexit, US-Sino relations and a US covid relief package. Equities struggle for direction, trading around their opening levels, with the action centered in the FX market.
Markit published the final versions of November Services PMIs. The German index was downwardly revised to 46, while for the whole EU, it was upwardly revised to 41.7. The Union’s Composite PMI was confirmed at 45.3, slightly better than previously estimated. The EU published October Retail Sales, which increased by more than anticipated, 4.3% YoY.
The US unveiled Initial Jobless Claims for the week ended November 27, which improved to 712K, beating expectations. Challenger Job Cuts printed at 64.797K in November, also better than the previous 80.666K. Markit will publish the final reading of its Services PMI while the US will publish the final ISM index, foreseen at 56 in November.
EUR/USD short-term technical outlook
The EUR/USD pair is overbought in the short-term but still poised to advance. The 4-hour chart shows that technical indicators resumed their advance after a modest corrective decline, holding within overbought levels. The 20 SMA continues advancing below the current price and above the longer ones, which slowly gain momentum. The overbought conditions may result in a corrective decline, but buyers will likely add at lower levels, with 1.2000 now acting as a critical barrier.
Support levels: 1.2125 1.2080 1.2035
Resistance levels: 1.2175 1.2230 1.2280
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Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
