EUR/USD Daily Forecast – Resistance At 1.2325 In Sight

EUR/USD Video 31.12.20.

Euro Continues To Move Higher Against U.S. Dollar

EUR/USD managed to settle above the resistance at 1.2280 and is trying to settle above 1.2300 while the U.S. dollar remains under pressure against a broad basket of currencies.

The U.S. Dollar Index managed to get below the support at 89.75 and is moving towards the next material support level at 89.40. Currently, the U.S. Dollar Index is trying to settle below yesterdays lows at 89.55. If the U.S. Dollar Index continues its downside move, EUR/USD will get additional support.

Today, foreign exchange market traders will wait for news on the U.S. stimulus story. In addition, traders will have a chance to take a look at the latest U.S. employment data.

Analysts expect that Initial Jobless Claims will increase from 803,000 to 833,000 while Continuing Jobless Claims will grow from 5.34 million to 5.39 million. The reports will provide traders with a chance to evaluate whether the second wave of the virus is putting additional pressure on the job market. At this point, the market is very optimistic about the speed of the recovery which is bearish for the American currency.

EUR/USD gained material upside momentum and is trying to settle above 1.2300. RSI has already entered into the overbought territory but there is still plenty of room to gain additional momentum.

The next resistance level for EUR/USD is located at 1.2325. If EUR/USD manages to settle above the level, it will head towards the next resistance level at 1.2350. It remains to be seen whether EUR/USD will be able to attract enough interest during the last trading session of the year but it has solid chances to continue its upside move in early 2021.

On the support side, the previous resistance level at 1.2280 will likely serve as the first support level for EUR/USD. If EUR/USD declines below this level, it will move towards the next support level at 1.2250. A successful test of this level will open the way to the test of the support at 1.2220.