- The dollar strengthens before the fall of the stock markets in the world.
- EUR / USD returns below the 20-day moving average.
The EUR / USD is falling on Wednesday for the third day in a row, accelerating the run, in line with a strengthening dollar throughout the market. The price fell below 1.1765 and reached 1.1733, the lowest level since October 19.
The dollar is rising against most currencies, excluding the yen, in a context of sharp decline in stocks. The European markets fall between 1.70% and 3.20%, while the futures point to an opening of the main Wall Street indices with declines close to 2%.
Fears about the new cases of coronavirus in Europe, together with the record figures from the United States, are generating growing concern about the impact on the economy of more restrictions on activities that are being imposed by different governments to reduce infections.
Regarding data, the leading indicator will be published today in the US, which does not usually have an impact on the markets. Thursday will be the turn of the PBI reading for the third quarter. The operators are also expected to begin to position themselves for the presidential elections that will be on Tuesday. Also tomorrow will be the meeting of European Central Bank.
From a technical point of view, the outlook for the euro has worsened significantly, after breaking below 1.1800. Now the EUR / USD is testing the 1.1730 zone, where a consolidation below would expose the October lows of 1.1685 / 90. A rally above 1.1785 would remove some of the downward pressure, but an advance over 1.1830 is necessary for the euro to strengthen again.
Credits: Forex Street
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