EURUSD analysis 10.09.2020

The single currency, the euro, fluctuated in a narrow, rising range during the Asian session, to witness its rebound for the second consecutive session from the lowest since August 21 against the US dollar on the cusp of economic developments and data expected today, Thursday, from the economies of the euro area and the US economy, which include decisions and directions of the bank The ECB and the upcoming press conference of the ECB Christine Lagarde Governorate.

At 06:34 AM GMT, the euro pair rose against the US dollar by 0.19% to 1.1825 levels, compared to the opening levels at 1.1803, after the pair achieved its highest level during the session's trading at 1.1828, while it reached its lowest level at 1.1801.

The markets are looking forward to France, the second largest economy in the euro area, the release of the industrial production index reading, which may reflect a slowdown in the pace of growth to 5.1% compared to 12.7% last June, before we see Italy, the third largest economy in the region, the release of the index reading itself, which may appear. It also slowed the pace of growth to 3.6%, compared to 8.2% in June.

This comes before we witness the activities of the ECB meeting and the disclosure of the monetary policy statement amid expectations that interest rates will remain at zero levels, leading to the press conference of the European Central Bank Christine Lagarde, who will report to me again later today to make concluding remarks at a virtual banking conference hosted by him German Central Bank.

Other than that, the markets are closely watching the developments of the Brexit file after they entered negotiations on the reformulation of future relations between the two parties following the implementation of the exit on January 31, in a state of stumbling due to the conflicting views between the two sides in several Main points, most notably immigration and the customs union, which opens the way for Britain to leave without an agreement with the European Union on October 15.

On the other hand, investors are currently awaiting the American economy for the release of the aid claims index reading for the past week on the fifth of September, which may reflect a decline by 43,000 requests to 838,000, compared to 881,000 in the previous weekly reading. The continuing aid for the past week, on August 29, decreased by 329,000 to 12,925,000, compared to 13,254,000.

This comes in conjunction with the disclosure of inflation data with the release of the producer price index reading, which is a preliminary indicator of inflation, which may reflect a slowdown in growth to 0.2% compared to 0.6% in July, and the core reading of the same index may also indicate a slowdown in growth to 0.2% compared to 0.5%. While the annual reading of the index may show that the deflation has shrunk to 0.3% from 0.4%, and the core annual reading reflects the stability of growth in August at 0.3%.

This comes before we witness the release of the final reading of the wholesale stocks index, which may confirm a decline of 0.1%, unchanged from the previous initial reading for the month of July, and compared to a decline of 1.4% last June, otherwise, according to the latest figures issued by the World Health Organization The number of cases infected with the Coronavirus has increased to nearly 27.5 million, and 894,983 people have died in 216 countries, and research and experiments are still being conducted with the aim of reaching a vaccine.

Technical analysis

The euro against the dollar is going through a re-test of the broken support of the rising channel that appears in the image, and it is still below it until now, noting that the EMA 50 meets the resistance that was formed at 1.1840 to add more strength to it, while the stochastic indicator loses its positive momentum to reach areas Buying saturation.

Thus, these factors encourage us to suggest the continuation of the bearish trend during the upcoming sessions, which targets testing 1.1720 areas initially, noting that breaching 1.1840 will stop the expected decline and return the price to the main bullish path again.

The expected trading range for today is between 1.1720 support and 1.1880 resistance.

The expected general trend for today: Bearish.