Current trend

USD is strengthening against EUR. The pair began to decline after the release of poor German Markit Composite PMI, which dropped to 52.7 points in October, while the forecast was expected to reach 54.8. EU Markit Composite PMI also did not meet the forecast, dropping to 52.7 points against the forecast of 53.9.

EUR is under pressure of the uncertainty with the Italian budget. The EU leadership was not satisfied with the statement by Italian Finance Minister Giovanni Tria, who noted that the government is ready to guarantee public debt at 2.4% and that this figure will not be exceeded in 2019. According to Brussels, an increase in the planned budget deficit from 0.8% to 2.4% can lead to an increase in Italian government debt. This year, the figure exceeded 130% of GDP, while according to EU rules, its size should not be more than 60%. During the day, the European Commission may reject the draft Italian budget and return it for processing. However, a fine or other sanctions are not expected, as they can strengthen the position of the Italian Euro-skeptics.

Today US October Markit Manufacturing and Service PMI will be released at 14:30 (GMT+2), the growth of indicators will affect the pair negatively.

Support and resistance

On the daily chart, the instrument was corrected to the lower border of Bollinger bands. MACD histogram is in the negative region, keeping the sell signal.

Resistance levels: 1.1430, 1.1460, 1.1515, 1.1550, 1.1600, 1.1630.

Support Levels: 1.1410, 1.1375, 1.1330, 1.1300.

Trading tips

Short positions can be opened from the level of 1.1400 with the target at 1.1300 and stop loss 1.1430.

Long positions can be opened from the level of 1.1550 with the target at 1.1630 and stop loss 1.1520.

Implementation period: 2–3 days.

Euro vs US Dollar

BuySellSpread
1.14481.1445822

Scenario

TimeframeDay's Range
RecommendationsSELL STOP
Entry Point1.1400
Take Profit1.1300
Stop Loss1.1430
Support levels1.1300, 1.1330, 1.1375, 1.1410, 1.1430, 1.1460, 1.1515, 1.1550, 1.1600, 1.1630

Alternative scenario

RecommendationsBUY STOP
Entry Point1.1550
Take Profit1.1630
Stop Loss1.1520
Support levels1.1300, 1.1330, 1.1375, 1.1410, 1.1430, 1.1460, 1.1515, 1.1550, 1.1600, 1.1630
EUR/USD: general analysis

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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