EUR/USD Forecast: Struggling with 1.1700, bearish

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1706

The risk-averse sentiment fuels dollar’s gains despite dismal US data.
Coronavirus contagions in Europe keep rising, and so do restrictions.
EUR/USD at the verge of losing the 1.1700 threshold.

The EUR/USD pair trades around the 1.1700 level, as the dollar continues to advance on the heels of risk aversion. The main market concerns are pandemic-related, amid the large increase in European coronavirus cases and the lack of a fiscal stimulus program in the US. Stocks are firmly lower worldwide, while government debt yields have also come under pressure.

As for macroeconomic data, the European Union didn’t publish relevant figures. The US, on the other hand, has just release Initial Jobless Claims for the week ended October 9, which unexpectedly rose to 898K, much worse than expected. The country also released the October NY Empire State Manufacturing Index which came in at 10.5, also missing the market’s expectations. The Philadelphia Fed Manufacturing Survey for the same month improved from 15 to 32.3, beating expectations. The discouraging news fuel equities’ slump and provide support to the greenback.

EUR/USD short-term technical outlook

The EUR/USD pair is trading around the 1.1700 figure, after hitting a daily low of 1.1691. The 4-hour chart shows that the pair keeps sliding below all of its moving averages, as the 20 SMA gains bearish traction, reflecting an increased selling interest. Technical indicators remain well into negative levels, although partially losing their bearish momentum. The risk is anyway skewed to the downside, with the immediate support level now at 1.1680.

Support levels: 1.1680 1.1635 1.1590

Resistance levels: 1.1725 1.1770 1.1810

View Live Chart for the EUR/USD

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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.

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