On Thursday, the EUR/USD succeeds to attract some dip traders and pushes further ahead of the 1.1200 line.
If the spot surpasses the 2021 low of 1.1186 (November 24), the next significant target is the July 2020 low of 1.1185 (July 1), followed by 1.1168 (June 19, 2020). A secondary reason for the present technical adjustment is the fact that the pair is currently oversold at the moment.
If the EUR/USD goes underneath the 2-month resistance level (which corresponds to the top reached in September) at 1.1580, the likelihood of more losses remains intact. In the long term, it is projected that the offered position in the spot will remain below the 200-day simple moving average (SMA) of around 1.1840.
Review Of The Technical Aspects
EUR/USD CHART Source: Tradingview.com
It reached a high of 1.1229 before retracing its steps, indicating that it still has more downside momentum ahead of it.
Using the 4-hour chart, we can see that the pairing is once again receding from around the bearish 20 SMA, and chart patterns have corrected oversold circumstances before becoming flat inside negative levels, which indicates that there is no buying activity in the market.
Once the pair falls below 1.1205, which serves as an immediate support level, a more significant support level around the 1.1160 price zone will most likely be reached. Nonetheless, particularly considering the holiday in the United States, the prospects of such a slide are extremely slim for the remainder of the day.
Support levels: 1.1205, 1.1160, 1.1120
Resistance levels: 1.1250, 1.1295, 1.1340
An Overview Of The Fundamentals
EUR/USD is holding onto moderate comeback gains over 1.1200 on Thursday, as trading circumstances dry out in the United States because of Thanksgiving Day celebrations there.
Before noon, no new information was released from the European Central Bank’s (ECB) Fiscal Policy Committee Account, which provided no new insight into the ECB’s policy stance.
On a relatively calm Thursday, the EUR/USD gained ground, moving in the 1.1220 price range. Appetite for the Dollar dwindled as the currency hit new annual highs versus the Euro and multi-month peaks against other major competitors in recent weeks.
As a result, the corrective pullback appears to be brief, as the US Dollar maintains its inherent strength. Because the US markets are off for the Thanksgiving holiday, trading volumes are light, and the US calendar is similarly light today.
Across Europe, Germany announced its second assessment of the country’s third-quarter gross domestic product, which was lowered from 2% to a little over 1%. In addition, the Monetary Policy Meeting Reports of the European Central Bank were published.
The report had little effect on the price since it reiterated the well-known patient posture taken by the European Central Bank’s officials.