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The last week has been the occasion of a sharp fall of the EUR/USD pair, to the point of having consequences on the underlying trend, which draws a bearish reversal after having followed an upward trend since mid-November 2019 about.
The Euro had indeed displayed several breaks in key, testing in particular the lower bound of an uptrend channel visible in the daily data.
The pair has certainly rebounded Friday, in the face of profit-taking, but also in the face of a report NFP disappointing, which hurt the dollar, and shows new gains this morning, but it is for the moment not sufficient to return the purchase.
In effect, the Euro-Dollar remains below its 200-day moving average, currently at 1.1139. This moving average has turned out to be a pivotal key in recent weeks, and is currently considered as immediate resistance on the Euro-Dollar.
In addition, the economic calendar empty on Monday pleaded for exchanges sas short-term trend, one more reason to stay away for the moment, especially as the opportunities to see the volatility increase (and the EUR/USD to choose a clear direction) will not miss this week.
A macroeconomic programme office this week
The highlight of this busy week should be the signing of the first phase of the trade agreement China-USA in Washington on Wednesday. As regards the u.s. data, traders will be watching updates of the CPI, retail sales, and industrial production.
The calendar of the european data itself will be relatively calm. The data of industrial production for November and the minutes of the meeting of the european central Bank of December will be monitored on Wednesday. The emphasis will probably be placed here on what we can expect from the strategic review of the monetary policy, such as a change in the inflation target.
Technical analysis and possible goals
In relation to important thresholds, it should be noted that a break above the 200-day moving average would expose the psychological threshold of 1.12 and the peak of the last week at 1.1205, before the summit of December 31, 2019 to 1.1240 and the psychological threshold of 1.13.
If a correction takes place, the psychological threshold of 1.11 will be the first bracket, before the moving average 100 days at 1.1060 and the psychological threshold key 1.10.
Finally, it should be noted that in its outlook technical day-to-day, the Commerzbank (DE:CBKG) has underscored this morning that the pair EUR/USD is facing a strong resistance to 1,1190-1,1240 – to know the MM 55 weeks, the downtrend channel from 2019-2020, and the recent summit. This protects the MM 200 weeks 1,1360 which continues to represent a point of rupture to be critical to the increase in the medium term”.
The bank believes that EUR/USD could drop to its MM 100 days (1.1060) this week, and then consolidate around this threshold.