The EUR / USD pair is trading down by 0.2% today. The main pressure on the price is exerted by the situation on the stock markets. Key indices are trading in the red, reflecting low risk appetite among investors. Considering the above, the US dollar, as one of the main defensive assets, is recovering its positions and is strengthening against all G7 currencies, with the exception of the Japanese yen, which also belongs to defensive assets.
In general, trading on Friday is quite calm. Investors are awaiting the release of preliminary data on manufacturing and services PMI in the US and the EU to assess the extent to which the pandemic will affect economic activity in the regions.
In Europe, a slight decrease in PMI is expected due to a worsening epidemiological situation in the EU. If the data comes out worse than market expectations, which is very likely, the European currency may come under strong pressure.
Also today, the IFO Institute will publish indices for Germany. The business climate index is expected to grow from 93.4 to 93.8 points.
In the US, experts predict a slight increase in the manufacturing sector PMI. Also, investors continue to follow political news in the United States.
The chart is dominated by bearish signals. The bulls failed to keep the price above the support at 1.1800. While the price remains below this level, we consider the scenario with the development of a downward movement to 1.1750 and below as a priority.
The main scenario - a decline to 1.1750.
An alternative scenario - a consolidation above 1.1800 and recovery to 1.1865.
The current fundamental outlook is neutral. We consider shorts in the range of 1.1800-1.1810.
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