EUR/USD: general analysis

Current trend

The European currency is trading within the strong “bearish” trend this month. At the moment, the EUR/USD pair is near two-year lows, and the scenario for further decline seems most likely.

Eurozone statistics are deteriorating, while the slowdown in the manufacturing sector is one of the key drivers of pressure on the instrument. Industrial production occupies a significant part in the European economy, so the spread of the coronavirus poses a significant threat to the European currency. Today's GDP data, reflecting a 0.1% annual slowdown, confirm the presence of negative trends. In addition, the ECB insists on the need for low interest rates and is considering expanding its quantitative easing policy, while the Fed is pursuing a more stable monetary policy. Thus, the strong fundamental differences between the US and EU economies indicate a poor euro against the dollar.

Today at 15:30 (GMT+2), a number of major publications on retail sales in the USA are expected, and at 16:15 (GMT+2), statistics on industrial production volumes will be released.

Support and resistance

On the 4-hour chart, a downtrend correction is observed. The instrument falls along the lower border of Bollinger bands. The indicator is directed downwards, and the price range remains wide, which indicates a continuation of the downtrend. The MACD histogram keeps a strong sell signal. Stochastic left the oversold zone, maintaining a buy signal.

Resistance levels: 1.0880, 1.0940, 1.0997, 1.1047.

Support levels: 1.0816, 1.0745, 1.0685, 1.0560.

Trading tips

Short positions may be opened from the current level with the target at 1.0745 and stop loss 1.0885.

Long positions may be opened above the level of 1.0870 with the target at 1.0940 and stop loss 1.0840.

Implementation period: 1–3 days.

Scenario

  • Timeframe

    Intraday

  • Recommendation

    SELL

  • Entry Point

    1.0842

  • Take Profit

    1.0745

  • Stop Loss

    1.0885

  • Key Levels

    1.0560, 1.0685, 1.0745, 1.0816, 1.0880, 1.0940, 1.0997, 1.1047

Alternative scenario

  • Timeframe

    Intraday

  • Recommendation

    BUY STOP

  • Entry Point

    1.0875

  • Take Profit

    1.0940

  • Stop Loss

    1.0840

  • Key Levels

    1.0560, 1.0685, 1.0745, 1.0816, 1.0880, 1.0940, 1.0997, 1.1047

Tifia trading account

Open

EUR/USD analysis for today.