Review: The EUR / USD currency pair is on a strong uptrend. Downward corrections run out in the area or slightly below the 10-EMA in the daily chart, which is currently trading at USD 1,225. EUR / USD is currently in a downward correction, which has so far been absorbed again by the 10-EMA. In the large picture on the weekly chart, the currency pair is slightly below the important resistance at USD 1,240. In addition, the weekly chart shows a bullish overlap between the 50 EMA and the 200 EMA – a signal that prices will continue to rise in the long term. As long as the 10-EMA continues and does not fall below it in the long term, prices can be expected to continue rising directly even in the short term.
Outlook: The upward trend is clearly intact in the EUR / USD currency pair. The current short-term downward correction could already expire.
The long scenarios: The currency pair catches again in the area of the 10-EMA and turns up again from here. The next target would then again be the area of USD 1,230, followed by the upper trend channel limit of USD 1,240. At the upper limit of the trend channel, however, EUR / USD could turn down again, as before, and move towards the 10-EMA.
The short scenarios: The EUR / USD currency pair breaks below the 10 EMA and develops further downward momentum. As a result, a return to the lower limit of the rising trend channel and to the 50’s EMA, which is currently in the area of USD 1,208, would be expected. But only with a sustained breakthrough below the 50’s EMA would the situation for the currency pair deteriorate significantly and a long-term decline can be expected.
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With Hans-Werner Sinn, Former President of the Ifo Institute: Corona and the miraculous increase in money in Europe
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