Euro gains ground against US dollar ahead of weekend
EUR / USD is testing resistance at 1.1880 again as the US dollar moves lower against a large basket of currencies.
The US dollar index has taken a bearish momentum and is trying to reach the test of the nearest support level at 92.10. If the US dollar index moves below this level, it will head for the next support at the annual low at 91.75 which will be bullish for EUR / USD.
Yesterday, the United States reported that initial jobless claims increased to 742,000 while continuing jobless claims declined to 6.37 million. The increase in initial jobless claims indicated that the recovery in the labor market has stalled and the US currency has faced additional pressure in the forex market.
Today the EU will provide the flash reading of the November Consumer Confidence Report. Consumer confidence is expected to decline from -15.5 in October to -17.7 in November due to the negative impact of European lockdowns.
Traders will also be awaiting further news on the US stimulus front. Republicans and Democrats have reportedly agreed to resume negotiations. Meanwhile, US Treasury Secretary Steven Mnuchin has said some pandemic loan programs will expire at the end of the year.
EUR / USD continues its attempts to settle above the nearest resistance level at 1.1880. In case the EUR / USD manages to break above this level, it will head towards the major resistance level at 1.1910.
A successful test of resistance at 1.1910 will pave the way for testing the next resistance at 1.1965. If EUR / USD moves above resistance at 1.1965, it will move to the psychologically important resistance level at September highs at 1.2000.
On the support side, the closest support level for EUR / USD is at 1.1830. If EUR / USD drops below this level, it will head to the next support level at 1.1800 although it may also get support at 20 EMA at 1.1820. In case the EUR / USD breaks below the support at 1.1800, it will test the 50 EMA at 1.1790.
For an overview of all of today’s economic events, check out our economic calendar.