EURUSD – Weekly Outlook- November 28 2019

EURUSD Outlook & Technical Analysis for US Binary Options

Introduction

The EURUSD, the most liquid and traded pair across all FX and RaceOption.com binary options broker terminals, entered a bearish spiral since it hit the 200-monthly Moving Average on January 01 ’18. Its exchange rate plunged below hidden bullish support 1.21545 on April 02 ’18 and sustained a prolonged bearish trend.

Should we expect a reversal and transfer of control from bearish to bullish momentum? Join us this week as we probe into the underlying technical patterns that are driving the pair and look into the possibilities of a reversal.

Fundamentals

German IFO Business Climate Index

The German Business Climate Index, which is compiled by the Institute for Economic Research (IFO), assesses the current German business climate, measuring expectations for the ensuing six months.

The index is based on a poll of builders, manufacturers, retailers, and wholesalers.

We can look forward to a bullish sentiment for the EUR if the reading is higher than anticipated. However, we can conclude that the trend is bearish for the EUR if the data reading is lower than forecasted.

Most recent data released November 25 points to a positive outlook for EUR with the actual and forecast readings at 95.0, while the previous reading was 94.7.

U.S. New Home Sales

New Home Sales measures the yearly number of new single-family homes sold during the previous month.

We can look forward to a bullish sentiment for the USD if the reading is higher than anticipated. However, we can conclude that the trend is bearish for the USD if the data reading is lower than forecasted.

Most recent data released October 24 points to a positive outlook for USD with the actual data reading -701K, and previous reading at 706K, while the forecast reading is -710K.

EURUSD Technical

EURUSD Long term Projection: Bearish and consolidating

Weekly Chart

Starting from a weekly time frame and considering the parabolic motion of the EURUSD forex exchange rate, the pair has been trading in alternating channels built by bearish and bullish divergence patterns.

EURUSD Outlook - Weekly chart - No 28 2019

otice the three sequence of bullish divergence chart setups on November 11 ’18, April 21 ’19, and the most recent on September 29 ’19. A collapse of hidden bullish support on November 03 sets the Euro and USD major currencies into a bearish correction phase.

Let’s move on to the daily time frame and see if there are clues for a bullish recovery, or if we should expect new lows.

EURUSD Medium Term Projections: Bearish 

Daily Chart

A combination of regular bullish and buying power on October 04 ’19 ignited a 1.88% price rally that later slowed upon approaching the MA-200 on October 20 ’19.

The price closed below significant support within the 200-daily Moving Average zone on November 14 ’19 and switched the sentiment to bullish (-1.23%).

On November 14, a bullish harmonic pattern alongside a break above resistance moved the price higher by 0.88%; however, the move could not stand the test of time as the bears increased the demand for the USD.

4HR Chart

As a trader, you can get highly reliable entry points by applying a combination of cyclic and/or candlestick patterns in your analysis.

An example is the regular bullish divergence pattern on November 14 ’19, which aligns with the bullish harmonic pattern on the daily time frame. However, an opposing regular bearish reversal pattern forced the price south by 0.53%.

Conclusion

The EURUSD at publication time established a double bottom formation, hinting on possible price surge to the upside after flagging another regular bullish divergence on November 26, 04:00 on the intraday 1hour TF.

However, the long term trend perspective looks bearish into the rest of the week.

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