EURUSD remains undecided as to which way its next directional break will be as the currency pair trapped inside the trading range between 1.1220 to 1.1360 in the last 5 weeks. The pair has been moving lower since June, largely due to a broad strengthening in the US dollar.
EURUSD traded with a bid tone for the entire last week, with some weakness seen only on the Friday after the King dollar regained some upside momentum. The pair has shown strength so far this week supported by the modest dollar weakness. Moving ahead, no important economic events are expected from the Eurozone this week, and so the focus shifts back on the coronavirus as cases surge globally and the US dollar movement.
As we progressed through the final days of the year, technically the overall momentum of the currency pair remains mixed. On the upside, the pair needs to stay above 1.1270 to have a chance to develop upside momentum in the near term. If prices settle above 1.1360, we may witness short term recovery to above 1.1420/40. On the flip side, the first nearest support level is located at 1.1270. In case if it breaks below this level, it will head towards the next support level which is located at near 1.1250 then 1.1220.
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