EUR/USD

EUR/USD: the Euro remains under pressure

Current trend. EUR declined against USD on Friday updating local lows of November 16.

EUR declines under the influence of negative statistics. The Q3 German economy has slowed down for the first time since 2015, the GDP indicator was –0.2%. The economy is under pressure of a reduction in German imports, which lasted from July to September. Preliminary November German and EU PMI also were negative. German Services PMI fell from 54.7 to 53.3 points, EU Services PMI decreased from 53.7 to 53.1 points. German Manufacturing PMI fell from 52.2 to 51.6 points, and EU one dropped from 52.0 to 51.5 points. The indicators approach the mid-point level of 50.0 points, below which sectors begin to reduce.

Today, EUR is trading in both directions. Investors are focused on the future results of the EU summit on Brexit, in particular, the speeches of the heads of the ECB and the Bank of England.

Support and resistance

Bollinger Bands in D1 chart decrease gradually. The price range is actively narrowing from above, reflecting the recovery of the "bearish" trend at the end of the previous trading week. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic keeps the downtrend, but approaches its minimum levels, which indicates the risks of oversold euro in the short term.

Existing short positions should be kept until the situation is clear.

Resistance levels: 1.1357, 1.1400, 1.1432, 1.1460.

Support levels: 1.1325, 1.1300, 1.1266, 1.1231.

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Trading tips

To open long positions, one can rely on the rebound from 1.1325 as from support with the subsequent breakout of 1.1357. Take profit — 1.1432. Stop loss — 1.1325.

A breakdown of 1.1325 may be a signal to further sales with target at 1.1266 or 1.1231. Stop loss — 1.1357.

Implementation period: 2-3 days.

 

Scenario

Timeframe Intraday
Recommendation BUY STOP
Entry Point 1.1360
Take Profit 1.1432
Stop Loss 1.1325
Key Levels 1.1231, 1.1266, 1.1300, 1.1325, 1.1357, 1.1400, 1.1432, 1.1460

 

Alternative scenario

 

Recommendation SELL STOP
Entry Point 1.1320
Take Profit 1.1266, 1.1231
Stop Loss 1.1357
Key Levels 1.1231, 1.1266, 1.1300, 1.1325, 1.1357, 1.1400, 1.1432, 1.1460

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