The Donald Trump impact on EURUSD hasn’t been positive, the markets perceive it as a risk factor and uncertainty for Europe. Also, the US dollar climbed on the higher odds of a December Fed rate hike. How low will EURUSD fare?
14 November, AtoZForex – EURUSD has continued to fall, reaching the low of the 10th March at the 1.0828 level. Even the released data did not support Euro. Germany reported the inflation for October. However, the market ignored the data, as the consumer price index (0.2% – in the month and 0.8% – on an annualized basis) is absolutely in line with expectations.
The EUR currency considers Trump as a risk factor and unpredictable for Europe. The uncertainty associated with his potential protectionist measures could push the ECB to the new stimulus, which is also negative for the euro. Aside, the Donald Trump impact on EURUSD, the USD has been climbing on the increased prospects of a December Fed rate hike. The market players are expecting an interest-rate hike at the next meeting.
Furthermore, the markets will be eyeing the speeches of Janet Yellen and Mario Draghi. In the second half of the week, Jannet Yellen will testify on the economic outlook and recent monetary policy actions. She can attest the Fed’s intention to raise the rate in December. Meanwhile, if Mario Draghi will express concern about the new US policy and indicate readiness to take additional measures to support the economy, then expect increased pressure on EURUSD.
EURUSD Technical analysis:
Today, the sharp fall of the euro in the Asian session helped to form a new downward price channel for the pair. The technical picture on the daily time frame shows a decline – the indicators point to a possible continuation of the sales. In regards to the 4-hour time frame, we have the same scenario.
- According to the SMA based analysis, currently, the short position is more relevant due to the pair has been trading below the moving averages 50, 100 and 200.
- The RSI is close to the oversold zone and directed downward.
- The MACD histogram is in the negative zone and below its signal line, continues smoothly decline, and thereby gives a signal to sell.
- The Stochastic Oscillator is in the oversold territory and generates the same signal, as the K line falls below the D line.
As all our main indicators show the decline for the EURUSD, we expect that the pair may decline further. It is likely that in the near future we will see 1.0560 level.
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