The EUR / USD pair on Friday is trading in a very narrow range amid the lack of news on the market that could upset the balance.
On Thursday, the European currency was able to recover some of its previously lost positions amid the publication of weak US inflation data. Core consumer price indices were below the forecasted values. A further decrease in inflationary pressures may require the Fed to further ease monetary policy.
At yesterday's online forum, the heads of the ECB, the Fed and the Bank of England warned bidders against being overly optimistic about the development of a vaccine against COVID-19. The economic situation remains dire and the vaccine will not be able to quickly change the situation. Recovery can take significantly longer than previously expected.
Today, the market is reconsidering its expectations for a vaccine, as it becomes clear that it can take a very long time to complete all trials, register and produce the required number of doses. According to the most optimistic forecasts, the massive use of the vaccine may begin no earlier than spring 2021. This means that the economies of the United States and Europe will be under the pressure of the pandemic for several more months.
In the United States, domestic political events remain in the spotlight. Against the background of continuing uncertainty, the demand for the US currency remains stable. Donald Trump refuses to recognize the election results, despite the fact that Biden has already collected more than 270 necessary electoral votes to win.
The question of the adoption of a new package of measures to stimulate the economy also remains uncertain. Negotiations between Republicans and Democrats have so far gone without tangible progress.
On the chart, the currency pair is stuck in the channel 1.1785-1.1830. It is likely that today the currency pair remains within this range.
The main scenario - a rise to 1.1830 and a downward reversal.
An alternative scenario - a breakdown of the resistance at 1.1830 and growth to 1.1865.
The current fundamental outlook is neutral. We consider longs from the level 1.1785.
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