EUR analysis 24.01.2020

The single currency fluctuated the euro in a narrow range slanting back down during the Asian session to witness its rebound to the tenth session in eighteen sessions from its highest since the seventh of last August and to prepare for its fourth consecutive weekly losses against the US dollar on the threshold of developments and economic data expected on Friday By the economies of the euro area and the US economy and in the shadows of the World Economic Forum 2020 events.

At 05:35 am GMT, the euro against the US dollar fell 0.05% to 1.1049 levels compared to the opening levels at 1.1055, after the pair achieved its lowest level during the trading session at 1.1048, while achieving the highest at 1.1058.

Currently, markets are awaiting for the French, German, and regional economies as a whole. The initial reading of the Markit index of industrial and service purchasing managers for the current month is released, which may reflect the shrinking of the services sector and the expansion of industry in France, the expansion of the service sector and the contraction of the industrial sector in Germany and the economies of the region as a whole.

This comes hours after the expiry of the press conference activities of the European Central Bank Governor Christine Lagarde and the meeting of the European Central Bank in which the monetary policy makers of the European Central Bank decided to maintain interest rates at their current zero levels and fix the marginal lending rate at 0.25% in addition to maintaining the interest rate on Deposits are negative -0.50% and proceed with the quantitative easing program at 20 billion euros per month.

Otherwise, investors are looking forward to the results of the talk of both the European Central Bank Governor Lagarde and her Japanese Central Bank Governor Haruhiko Kuroda in addition to the US Treasury Secretary Stephen Manuchin, where they are scheduled to participate in a panel discussion entitled "Global Economic Prospects" at the Davos Forum The global economist in Switzerland.

On the other hand, markets are awaiting to reveal the initial reading of the Markit Industrial and Services PMI for the United States, the world's largest economy and the largest industrial country, which may reflect the stability of the expansion of the industrial sector at a value of 52.4, little changed from the previous reading of December, The service sector, which represents more than two-thirds of US gross domestic product, expanded to 52.9 compared to 52.8 in December.

Technical analysis

The EURUSD pair confirmed the break of the upside channel support after the daily candle closed below it, to open the way for the continuation of the decline over the intraday basis, noting that our next negative target is at 1.0985.

We point out that exceeding the mentioned target will extend the descending wave to reach 1.0860, while the expected decline will remain in place unless the price is able to breach the 1.1075 level and hold above it again.

The expected trading range for today is between 1.0960 support and 1.1100 resistance.

Expected trend for today: bullish.