Despite current growth, the euro is still vulnerable against the dollar, while EUR / USD remains in a global downtrend.
Data released last Friday indicated an increased risk of worsening recession in German industry. Industrial production in October fell by 1.7% compared with the previous month after a decline of 0.6% in September.
Compared to October last year, industrial production decreased by 5.3%, and recent polls by economists do not contain any signals that the situation is improving.
In the 3rd quarter, Eurozone GDP, according to updated data provided by Eurostat last week, grew by 0.2% (+1.2% in annual terms). Eurozone GDP is also likely to show slight growth in the 4th quarter. However, many economists point out that the risks for the 4th quarter are still biased towards the downside.
This week, financial market participants will follow the publication of decisions by the Fed and the ECB at rates on Wednesday (at 19:00 GMT) and on Thursday (at 12:45 GMT), respectively. Bets are likely to remain at current levels. Comments on rate decisions and press conferences by the Fed and the ECB, which will also begin on Wednesday (at 19:30 GMT) and on Thursday (at 13:30 GMT), will be of interest.
If the management of the Fed or the ECB signals aimed at changing the monetary policy plans in the near future, then the volatility in the quotations of the dollar and the euro and the pair EUR / USD will increase sharply. Similar press conferences in previous years moved the euro by 3-5%.
At the moment, EUR / USD is developing an upward movement above the short-term support levels of 1.1064 (ЕМА200 on the 1-hour chart), 1.1058 (ЕМА200 on the 4-hour chart, ЕМА50 on the daily chart). Nevertheless, the correctional growth of EUR / USD will be limited by the resistance levels of 1.1115 (ЕМА144), 1.1160 (ЕМА200 on the daily chart).
In general, the long-term negative dynamics of the EUR / USD pair remains, which speaks in favor of its sales.
Support Levels: 1.1064, 1.1058, 1.0995, 1.0940, 1.0900
Resistance Levels: 1.1115, 1.1160
Trading Recommendations
Sell Stop 1.1050. Stop-Loss 1.1120. Take-Profit 1.0995, 1.0940, 1.0900
Buy Stop 1.1120. Stop-Loss 1.1050. Take-Profit 1.1155
