Based on the early price action, the direction of the EUR/USD on Monday is likely to be determined by trader reaction to the main 50% level at 1.1691.
The Euro is trading higher against the U.S. Dollar on Tuesday as a jump in higher risk assets drove down demand for the safe-haven U.S. Dollar.

Euro Zone bond yields also rose on Tuesday with markets increasingly confident challenger Joe Biden would win the U.S. presidential election, although trading was quiet as investors refrained from taking on new large positions before the outcome.
At 13:15 GMT, the EUR/USD is at 1.1702, up 0.0063 or +0.54%.

The rise in yields also followed Monday’s drop as investors rushed for safer assets in the wake of new lockdown restrictions imposed by governments across Europe to fight the spread of COVID-19.

Today’s price action in the Forex market is likely short-covering. I don’t think the bigger players are taking outright long positions ahead of the election. Instead, they are jumping into the derivatives market to buy protection against unexpected near-term moves in the currency.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A move through 1.1622 will signal a resumption of the downtrend. A trade through the main bottom at 1.1612 will reaffirm the downtrend.

The main trend changes to up on a trade through 1.1881. This is highly unlikely, however, there is room to complete a normal 50% retracement of the recent sell-off.

The main range is 1.1371 to 1.2011. Its retracement zone at 1.1691 to 1.1616 is support. This zone stopped the selling on Monday at 1.1622.

The minor range is 1.1881 to 1.1622. Its 50% level at 1.1751 is potential resistance.

The short-term range is 1.2011 to 1.1612. Its retracement zone at 1.1811 to 1.1859 is a second retracement zone target.
Daily Swing Chart Technical Forecast
Based on the early price action, the direction of the EUR/USD on Monday is likely to be determined by trader reaction to the main 50% level at 1.1691.

Bullish Scenario
A sustained move over 1.1691 will indicate the presence of buyers. This could create the upside momentum needed to challenge the 50% level at 1.1751. This is a potential trigger point for an acceleration into the short-term 50% level at 1.1811.

Bearish Scenario
A sustained move under 1.1691 will signal the presence of sellers. If this generates enough downside momentum then look for the selling to possibly extend into a support cluster at 1.1622, 1.1616 and 1.1612. The latter is a potential trigger point for an acceleration to the downside.

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