EUR/USD Daily Forecast – Euro Is Moving Lower Against U.S. Dollar
U.S. Dollar Gains Ground Against Euro
EUR/USD is currently trying to settle below the support level at 1.1350 while U.S. dollar is moving higher against a broad basket of currencies.
The U.S. Dollar Index is moving towards the resistance at the 96 level. In case the U.S. Dollar Index manages to settle above this level, it will head towards the next resistance at 96.25 which will be bearish for EUR/USD.
Today, foreign exchange market traders will focus on the final readings of Manufacturing PMI reports from EU and U.S. Analysts expect the Euro Area Manufacturing PMI declined from 58.4 in November to 58 in December. In the U.S., Manufacturing PMI is projected to decrease from 58.3 to 57.8.
It will be interesting to see whether the recent surge in the number of new coronavirus cases provides additional support to the safe-haven U.S. dollar. The American currency was range-bound in December, but volatility may increase as traders typically establish new positions at the start of the year.
Technical Analysis
EUR/USD faced significant resistance near 1.1385 and pulled back below the support level at 1.1350. In case EUR/USD manages to settle below this support level, it will head towards the next support which is located near the 20 EMA at 1.1330.
A successful test of the support at 1.1330 will push EUR/USD towards the support at 1.1300. This support level has been tested many times in recent trading sessions and proved its strength. If EUR/USD declines below 1.1300, it will move towards the support at 1.1270.
On the upside, a move above 1.1350 will push EUR/USD towards the resistance level which is located at the 50 EMA at 1.1365. In case EUR/USD manages to settle back above the 50 EMA, it will head towards the resistance level which has recently emerged at 1.1385. A move above the resistance level at 1.1385 will open the way to the test of the next resistance level at 1.1400.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
