EUR/USD: COVID-19 statistics push the pair downwards 18 January 2021, 10:58

 

EUR/USD: COVID-19 statistics push the pair downwards

18 January 2021, 10:58

Scenario
Timeframe	Weekly
Recommendation	SELL STOP
Entry Point	1.1995
Take Profit	1.1730
Stop Loss	1.2100
Key Levels	1.1730, 1.2000, 1.2170, 1.2340

Alternative scenario
Recommendation	BUY STOP
Entry Point	1.2175
Take Profit	1.2340
Stop Loss	1.2100
Key Levels	1.1730, 1.2000, 1.2170, 1.2340

Current trend

The EUR/USD pair is declining, trading around the level of 1.2068.

The European currency is falling against most world currencies due to the dire situation with the coronavirus pandemic. Yesterday in Germany, 1,244 deaths from the virus were recorded, which is a new anti-record. Against this background, the authorities announced that the current quarantine measures could be tightened up to a complete stop of public transport and other services.

The USD Index demonstrates extremely illogical dynamics and is growing, trading around 90.800. The macroeconomic statistics published on Friday was significantly worse than expected but did not in any way affect the national currency rate. The core retail sales index for December was –1.4%, which is worse than the expected value of –0.1%. The producer price index dropped to 0.3% against the forecast of 0.4%, and the volume of retail sales reached –0.7% instead of –0.2% expected.

Support and resistance

On the global chart of the asset, the price moves within a wide ascending channel and, having reversed at the resistance line, goes downwards. Technical indicators reversed and issued a new sell signal. Fast EMAs on the Alligator indicator crossed the signal one downwards, and the AO oscillator histogram moved into the negative zone.

Resistance levels: 1.2170, 1.2340.

Support levels: 1.2000, 1.1730.

Trading tips

After decline or consolidation below the local support level at 1.2000, sell positions with the target at 1.1730 are relevant. Stop loss is 1.2100, above the local resistance. Implementation period: 7 days or more.

After reversal and global growth or consolidation above the local resistance around 1.2170, buy positions with a target in the area of ​​1.2340 will become relevant. Stop loss is 1.2100.