The euro traded higher against the US dollar on Friday as the vote count for the contentious US election slowly moved towards a divided government and investors forecast more losses for the greenback.
The single currency rose sharply this week due to the weaker dollar, but also benefited from news of the European Union closing in on a budget deal.
At 4:27 p.m. GMT, EUR / USD is at 1.1884, up 0.0054 or + 0.46%.
Investors are betting Democrat Joe Biden will become the next president, but Republicans will retain control of the Senate, making it difficult for Democrats to push through the larger coronavirus relief package they advocate.
Technical analysis of the daily swing chart
The main trend is up according to the daily swing chart. The trend was evident on Friday when buyers broke the swing top at 1.1881. The main trend will go down on a trade to 1.1603.
The main range is from 1.1371 to 1.2011. Its retracement zone at 1.1691 to 1.1616 is support. This area was tested earlier in the week.
The minor range is from 1.2011 to 1.1603. EUR / USD is currently trading on the strong side of its retracement area at 1.1855 to 1.1807, placing it in a bullish position. This area is a potential support.
Daily Swing Chart Technical Forecasts
The direction of EUR / USD towards the close will likely be determined by the trader’s reaction to the short-term Fibonacci level at 1.1855.
A sustained move above 1.1855 will indicate the presence of buyers. Exiting the intraday high at 1.1891 will indicate the buy is strengthening. This could trigger a rally to the next major high at 1.1917. This is a potential trigger point for acceleration towards the main September 1 high at 1.2011.
A sustained move below 1.1855 will signal the presence of sellers. This could trigger a breakout in the 50% level at 1.1807. This is a potential trigger point for an acceleration to the downside, with the 50% major level at 1.1691 being the next major downside target.
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