The euro cross continued to trade lower last month, down 0.50%. But the lower end has been offering concrete support since June. The series of bottoms in June, September, and November should now become support, and so if you are bullish EUR into November, then this is the place to take a long trade.
FX: The GBP outperform the major counter pairs in November. Especially against the dollar, the pound rallies nearly 3%. Against safe-havens, the pound rallied more than 2% against the CHF and JPY. But cyclical currencies AUD and NZD outperformed against the pound by 2% each. Finally, our subject currency remained trading down by 0.5% in November.
Macros: Data side, other week’s UK labor data, and last week’s PMI readings were upbeat. UK’s manufacturing PMI was printed at a 3-month high, but the service sector dented further on the second lockdown in the UK.
We are looking ahead, empty economic calendar leaving traders sidelines. But we focus on EZ data. The return of EUR strength should allow the cross to perform better.
TECHNICAL OVERVIEW
Momentum appears to have stalled. The technical landscape has not changed since June.
The price action has been in a deceleration trend since mid-September. Now we are now finally tested the major support level. The series of bottoms in June, September, and November should now become support, and so if you are bullish EUR into December, then this is the place to take a long trade. Since June 2020, four times wheels kissed the ground at 0.8860.
But the price lost all the daily moving averages, and the 50MA on the weekly chart is under threat.
The weekly closing level is crucial. We remain neutral this week again and will watch the trend closely.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
What is your Technical View?
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