EUR/USD Forecast: Underpinned by rising equities

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1709

The dollar gave up early gains as the presidential race shows tight results.
The US ADP Survey indicated a slower-than-anticipated pace of job creation in October.
EUR/USD intrinsically bullish, needs to overcome the daily high at 1.1770.

The EUR/USD pair peaked at 1.1770 and then fell to 1.1602 during Asian trading hours and as the results of the US presidential election began arriving. The greenback is now under pressure and equities trimmed intraday losses as the presidential race tightens. Georgia, Michigan, Nevada, North Carolina, Pennsylvania and Wisconsin are yet to finalize counting ballots.

US elections overshadow everything else, although worth mention that Markit published the final versions of October Services PMIs, which were upwardly revised in most of the EU. The German index printed at 49.5 from 47.3, while the Union index improved from 46.2 to 46.9. As for the US, the country just released the ADP survey, which showed a slower than expected pace of job creation in October. The private sector added 365K new positions, far below the 650K expected and the previous 753K.

EUR/USD short-term technical outlook

The EUR/USD pair is at the upper half of its daily range, trading around 1.1710. The bullish potential for the pair would remain limited as long as it trades below 1.1770, the daily high. The 4-hour chart shows that the 100 and 200 SMA converge around the mentioned high, reinforcing the static resistance level. At the same time, it is trading above its 20 SMA, which retains a modest bullish slope. Technical indicators, in the mentioned time-frame, maintain their bullish slopes within positive levels.

Support levels: 1.1690 1.1645 1.1600

Resistance levels: 1.1770 1.1820 1.1870

View Live Chart for the EUR/USD

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.

AUD/USD climbs toward 0.7000 after strong China data dump

AUD/USD attracts follow-through buyers for the second straight day on Monday, extending last week's recovery toward 0.7000 in Monday's Asian trading. Strong Chniese Q3 GDP and activity data for September strengthen the pair's advance, following RBA Assistant Governor Chris Kent's hawkish remarks.

USD/JPY struggles near 158.00 amid hawkish BoJ, subdued USD

USD/JPY remains defensive near 158.00 in the Asian session on Monday, as the US Dollar remains depressed near a two-week low amid the recent decline in US bond yields. Furthermore, looming intervention risks underpin the Japanese Yen and weigh on the pair amid BoJ Governor Kazuo Ueda's hawkish remarks. However, Fed rate-hike bets and geopolitical uncertainties could limit USD losses and the major.

Gold holds firm below $4,200 on falling US yields

Gold holds gains but remains below the $4,200 mark in the European session on Monday. US Federal Reserve Chair Kevin Warsh’s unwillingness to provide any cues on further policy moves led to a reduction in odds for policy tightening later this month. Moreover, the recent sharp retracement slide in US government bond yields from multi-year highs, acts as a tailwind for the non-yielding bullion.

Cardano risks 15% downside as retail demand, bullish momentum wane

Cardano (ADA) is trading above $0.2200 at press time on Monday, holding steady after a 12% decline the previous week. The altcoin is losing retail interest as the notional value of active ADA futures positions declines. The technical outlook for ADA suggests a downside bias following the bearish breakout below a near-term support trendline last week.

Canada CPI expected to show a pick-up in inflation in September

Canada’s September Consumer Price Index figures will be the focus of attention on Monday. Indeed, Statistics Canada data will provide markets with an update on price pressures ahead of the Bank of Canada’s October 28 gathering, when officials are expected to keep the interest rate steady at 2.25%, broadly in line with analyst consensus. Economists expect the headline CPI to pick some upside traction at 3.2% YoY and to rise by 0.2% on a monthly basis.

Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff

Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.