EUR/USD: growth due to the positive statistics 20 January 2021, 10:55

EUR/USD: growth due to the positive statistics

20 January 2021, 10:55

Scenario
Timeframe	Weekly
Recommendation	BUY STOP
Entry Point	1.2177
Take Profit	1.2342
Stop Loss	1.2100
Key Levels	1.1880, 1.2070, 1.2177, 1.2342

Alternative scenario
Recommendation	SELL STOP
Entry Point	1.2070
Take Profit	1.1880
Stop Loss	1.2140
Key Levels	1.1880, 1.2070, 1.2177, 1.2342

Current trend

The EUR/USD pair is correcting upwards, trading around the level of 1.2143.

The euro recovers losses on the background of positive macroeconomic statistics. EU economic sentiment index from ZEW rose to 58.3 points for January from 54.4 points for December. Germany's economic sentiment index for the same period was 61.8 points, compared with 55.0 points for December, and Germany's consumer price index for December reached 0.5%, up from –0.8% for November. The index grows steadily despite Angela Merkel's yesterday’s announcement that strict quarantine measures will be extended until at least February 14.

The US currency is declining on minimal volumes. Such dynamics is quite logical, as most investors before today's inauguration of Joe Biden prefer to watch the situation, fearing unforeseen events.

Support and resistance

On the daily chart, the price moves within a new uptrend channel, where it has reversed at the support line and is now rising. The technical indicators reversed and issued a new sell signal. Fast EMA on the indicator Alligator crossed the signal one downwards, and the histogram of oscillator AO entered the negative zone. Nevertheless, the probability of growth continuation remains.

Support levels: 1.2070, 1.1880.

Resistance levels: 1.2177, 1.2342.

Trading tips

After corrective growth and the consolidation above the local resistance of 1.2177, buy positions with the target at the level of 1.2342 will be relevant. Stop loss is 1.2100. Implementation period: 7 days or more.

After decrease or consolidation below the local support of 1.2070, sell positions with the target at 1.1880 are relevant. Stop loss is 1.2140, above the local resistance.