EUR/USD: Bulls need a big beat on German IFO Expectations


  • EUR/USD trades near 1.1850 versus 1.1833 in early Asia. 
  • Monday's price action shows indecision in the market place. 
  • A big beat on German IFO Expectations data is needed to force a bullish close. 

The EUR/USD pair is in stasis, and the forward-looking German IFO Expectations index could provide a clear directional cue to the indecisive market. 

Two-way business

The pair traded back and forth in the 1.18-1.1906 range on Monday, forming a daily candle with long upper wicks. That's a sign of indecision – both bulls and bears unwilling or unable to lead the price action. 

A close above 1.1906 is now needed to put the bulls back into the driver's seat. Alternatively, acceptance under 1.18 would pave the way for a notable bearish move. The pair is currently trading near 1.1850, representing marginal gains on the day. 

Focus on IFO

The German IFO Expectations index is seen falling to 93.5 in November from October's 95.00. The data is closely watched as an early indicator of current conditions and business expectations for the next six months, where firms rate the future outlook as better, same, or worse.

A big beat on expectations would alleviate fears of a double-dip recession and put a bid under the single currency, possibly lifting EUR/USD above Monday's high of 1.1906. Germany, the Eurozone's economic powerhouse, is struggling to contain the second wave of coronavirus and has imposed the economically-painful lockdown restrictions. As such, the odds of the IFO data missing forecasts are high. That would shift risk in favor of a drop below Monday's low of 1.18. 

Apart from the IFO numbers, the pair could also take cues from the German third-quarter Gross Domestic Product, due at 07:00 GMT, and comments from European Central Bank member Schnabel. 

Technical levels

EUR/USD

Overview
Today last price 1.1849
Today Daily Change 0.0011
Today Daily Change % 0.09
Today daily open 1.1838
 
Trends
Daily SMA20 1.179
Daily SMA50 1.1775
Daily SMA100 1.1744
Daily SMA200 1.1383
 
Levels
Previous Daily High 1.1906
Previous Daily Low 1.18
Previous Weekly High 1.1894
Previous Weekly Low 1.1814
Previous Monthly High 1.1881
Previous Monthly Low 1.164
Daily Fibonacci 38.2% 1.184
Daily Fibonacci 61.8% 1.1865
Daily Pivot Point S1 1.179
Daily Pivot Point S2 1.1742
Daily Pivot Point S3 1.1684
Daily Pivot Point R1 1.1896
Daily Pivot Point R2 1.1954
Daily Pivot Point R3 1.2002

 

 

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