EUR/USD Eyeing Fresh Increase Above 1.1880
- EUR/USD started a downside correction from the 1.1920 resistance.
- A key bullish trend line is forming with support near 1.1805 on the 4-hours chart.
- The Euro Area Gross Domestic Product grew 12.6% in Q3 2020 (Prelim).
- GBP/USD is holding the 1.3100 support, USD/JPY declined below the 105.00 support.
EUR/USD Technical Analysis
The Euro started a downside correction after trading to a new monthly high at 1.1920 against the US Dollar. EUR/USD declined below 1.1880, but it remained well bid above the 1.1750 level.
Looking at the 4-hours chart, the pair found a strong support near the 1.1750 level, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours).
A swing low was formed near 1.1745 before the pair started a fresh upward move. It climbed back above the 1.1800 level, and traded above the 38.2% Fib retracement level of the downward move from the 1.1920 high to 1.1745 low.
Moreover, there is a key bullish trend line forming with support near 1.1805 on the same chart. If there is a downside break below the trend line support, the pair might find support near the 100 simple moving average (red, 4-hours).
Any further losses may perhaps open the doors for a sharp decline towards the 1.1700 support zone. Conversely, the pair could continue to rise towards the 1.1860 and 1.1880 resistance levels. The next major resistance is near 1.1920, above which the pair could rally towards the 1.2000 level in the near term.
Overall, EUR/USD must stay above the 100 SMA to continue higher above 1.1850. Similarly, GBP/USD must stay above 1.3100 to climb higher towards the 1.3300 level.
Upcoming Economic Releases
- NY Empire State Manufacturing Index Nov 2020 – Forecast 13.0, versus 10.5 previous.
- Canadian Manufacturing Sales Sep 2020 (MoM) – Forecast +0.5%, versus -2.0% previous.