Last Updated on October 9, 2020

EUR/USD Dollar Outlook & Technical Analysis


The U.S. election is around the corner, and the present administration needs every pointer to show that the economy is recovering for them to will the hearts of the Americans.

Therefore, this week’s economic calendar will interest USA binary options brokers, investors, Institutions, and traders worldwide for a clearer picture of the U.S. economy since the reopening of the economy.

Euro Zone Fundamentals

German Unemployment Change:

We consider this report a lagging indicator because it comes at a later date or ends of the month, showing the number of unemployed persons from the previous month. The outcome also boosts consumers’ spending, and it’s a sign of a healthy economy.

When the data released is lower than the forecast, it is suitable for the currency, but if the actual is higher above the forecast it won’t favor the Euro, and it will be bearish.

The forecast is -7K while the previous was -9K

U.S. Fundamentals

Non-Farm Employment Change

The Bureau of Labor Statistics is responsible for data collation from the various organizations showing numbers of employment in the month compared to the previous month, excluding the farming sectors during the report. 

When the report released favors the U.S. economy, it will mean that the actual information is greater than the forecast, but it will mean that the US dollar will be bearish if it is lower.

The forecast is 900k while the previous data was 1371K

EUR/USD Technical Analysis

EUR vs. USD Long-term Objective: Bullish 

Monthly Chart

EUR/USD Outlook - Monthly Chart - 1st october 2020

Monthly Resistance: 1.15698, 1.21545, 1.18523

Monthly Support: 1.10292, 1.08288, 1.06359

The Bullish trend on the monthly chart is still in the right direction as long as the bearish movement has not formed a reversal pattern of the monthly time frame.

As the month closes, we can see that the EUR/USD pairs are dominated by bears and pushing the price down towards the previous resistance zone turned into support 1.15698

We expect the bearish move to stop at the support levels before another swing to the upside is established. If the bulls are not strong, we may see another break out below for another swing low to 1.10292, but if they can push the price above 1.18523, the next level is 1.21545.

EURUSD: Weekly Chart Bullish

EUR/USD Outlook - Weekly Chart - 1st october 2020

Weekly Resistance: 1.14963, 1.19207, 

Weekly Support: 1.16959, 1.14222, 1.12430, 1.08968

The EUR/USD pair finally broke out of the ranging zones that trapped price for almost eight weeks of trading. The previous trading week closed with a bearish candle below the 1.16959 support levels. 

These show that the bears will continue to dominate the new week and possibly push down the price to the next support zone of 1.14222. If the U.S. dollar continues to be healthy in the coming weeks, we may see it reaching the 1.12430 support levels if all things are equal.

The 1.16959 support won’t go without a bullish attempt by the Bulls for another upward rally to the 1.19207, which l know that may be difficult. However, should they succeed, this will mean that the bear’s move was a failed breakout.

EURUSD Mid-Term Projections: Bullish Consolidating

EURUSD: Daily Chart

EUR/USD Outlook - Daily Chart - 1st october 2020

Daily Resistance Level: 1.20111, 1.19657, 1.19163

Daily Support Level: 1.16122

Let us look at the bearish candles that broke through the 1.16960 support zones. We can see that they were big strong candles with no bullish candles in between them, giving us a sign of a bearish accumulation.

The bull retested the 1.16960 level and was rejected by the bears at the time of writing. If the bulls can break through the 1.16960, they can push the EUR/USD pair back to the 1.19163 levels.

EURUSD: H4 Chart

H4 Resistance Level: 1.1950, 1.19175, 1.18618, 1.17559, 1.16544

H4 Support Levels: 1.16110 

The EUR/USD pair on the four-hour chart is a bearish trend because the price is below the 200 moving average, having closed below the support levels of 1.17559 and 1.16544, respectively. We expect the downtrend to continue if the pair can close below the 1.16110 level.

A regular bullish divergence is building up at the support level, and you can see that the bulls have held that support for the past twelve hours for the price to bounce up as time progresses. The bulls may take the price up if they can close above the 1.16544 resistance levels.

Bullish Scenario:

The bullish scenario build-up can be seen on the four-time chart, having lost the ground to the bears for some days. The Bulls dominance will start from the support level of 1.16110 with the hope of reaching the 1.16544 level.

Bearish Scenario:

The sellers were able to dominate the EUR/USD market on the daily chart have closed below the significant support level 1.16960 that has been held for an extended period. This movie shows a sign of strength in the U.S. economy and is suitable for the U.S. dollar.

Conclusion and Weekly Price Objectives

This week will bring forth a new month, and the economic calendar will focus more on the U.S. economy, which will have a prolonged impact on the market. If the news favours the U.S. economy, we shall see the US dollar gaining against other pairs as the new month unfolds.

Technically for the week, we see the US dollar gaining strength after a retest of the previous support turned resistance that can push down the price.

James S. Martin
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