has been falling for the fourth trading session in a row; it is retreating towards 1.2170 with a monthly high at 1.2350.
It’s quite interesting that the USD started strengthening right after the Democrats won the majority in the Senate. The majority will help the Democratic party to quickly approve the stimulus package for supporting the American economy. It appears that a possible positive influence of the package results beats some minor issues, for an increase in the money supply.
When it comes to attracting attention in the media space, the USA started this year very actively. The news includes attempts of President Donald Trump to retire from his post with a bang, domestic insurgencies and disturbances, and preparation for the inauguration of the new president. All these factors are a good injection of emotions for the USD.
In the H4 chart, after forming another consolidation range around 1.2255 and breaking it to the downside, EUR/USD has reached the short-term downside target at 1.2170. Today, the pair may correct to test 1.2255 from below and then form a new descending wave with the first target at 1.2160. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving below 0, thus implying that the descending wave is not over yet.
As we can see in the H1 chart, after finishing the third structure of the descending wave, EUR/USD is expected to correct with the target at 1.2255. After that, the instrument may form a new descending structure with the first target at 1.2160. From the technical point of view, this scenario is confirmed by Stochastic Oscillator: its signal line is steadily growing towards 50 and may later break it. In this case, the line may continue moving to reach 80.
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