General analysis EURUSD for 29.11.2021

Current dynamics

Last Friday the single European currency considerably strengthened against the U.S. dollar. The pressure on USD was formed by the news on the appearance of a new strain COVID-19, as well as positive statistics from the Eurozone.

Before the appearance of the new strain, investors expected the Fed to tighten the monetary policy in three rounds in 2022, now the probability of such developments has decreased. At the same time, doctors said that there were no serious symptoms in those infected, and Pfizer said that a vaccine for omicron will be developed in early 2022. Humanity already has the necessary experience to resist COVID-19, with virologists predicting that it will take no more than four weeks to research. However, Omicron will definitely be a driver of volatility in the market in the next 2 months. Meanwhile, members of the Open Market Committee are reassuring investors. According to the Fed officials, the economy's run-up will allow them to survive a new wave of the coronovirus, and the experience gained in the past will allow them to quickly cope with the new strain.

Today at 3:00 p.m. (GMT+2), Germany will release its consumer price index for November. At 5:00 p.m. (GMT+2), Fed Chief Powell is expected to speak. This will be the first speech since President Biden approved the official's re-election as head of the U.S. regulator. Powell is also likely to underestimate the impact of the new strain on the U.S. economy, which will contribute to the strengthening of the dollar. Also at 17:00 (GMT+2), statistics on the U.S. real estate market will be released. In addition, the U.S. Treasury Secretary, the head of the Bundesbank and the chairman of the ECB are scheduled to speak today.

Support and resistance levels

On the 4-hour chart the instrument trades at the top of the Bollinger Bands. The indicator has reversed upward and the price range is widening, indicating further strengthening of the pair. Histogram MACD is growing in the positive zone, forming a buy signal. Stochastic does not give a clear signal to open positions.

• Support levels: 1.1170, 1.1205, 1.1240, 1.1260.
• Resistance levels: 1.1295, 1.1320, 1.1360, 1.1410.

Trading scenarios

• Short positions can be opened at the current price with a target of 1.1205 and a stop-loss at 1.1330. Implementation period: 1-3 days.
• Long positions should be opened above the level of 1.1325 with a target of 1.1375 and a stop-loss at the level of 1.1295. Implementation period: 1-3 days.