The Euro is trading lower against the U.S. Dollar on Friday as weak demand for higher risk assets is helping to drive investors into the safety of the U.S. Dollar. This week’s weakness in the Euro is being blamed on rising coronavirus infections in Europe, which is limiting risk appetite.
France will tighten its COVID-19 border controls and bring its curfew forward by two hours, while German Chancellor Angela Merkel said she wanted “very fast action” to counter the spread of virus variants after Germany had a record number of deaths.
At 14:22 GMT, the EUR/USD is trading 1.2109, down 0.0045 or -0.37%.
In economic news, the Euro Zone’s trade surplus rose as expected in November despite an economic slowdown and falling trade turnover, mainly thanks to a better trade balance with Russia Turkey, Norway, Japan and South Korea, data showed on Friday.
The European Union’s statistics office Eurostat said the trade surplus of the 19 countries sharing the Euro with the rest of the world was 25.8 billion Euros in November, up from 20.2 billion a year earlier.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through 1.2025 will change the main trend to down. A move through 1.2349 will signal a resumption of the uptrend.
On the upside, resistance is a 50% level at 1.2187.
The short-term range is 1.1800 to 1.2349. Its 50% level at 1.2074 is a potential support level and trigger point for an acceleration to the downside.
Daily Swing Chart Technical Forecast
We’re looking for today’s early weakness to continue as long as the EUR/USD remains on the bearish side of the 50% level at 1.2187. If this creates enough downside pressure then look for the selling to possibly extend into the 50% level at 1.2074.
Look for a technical bounce on the first test of 1.2074, but be prepared for the start of a steep sell-off if this level fails as support.
Basically, we’re looking for an upside bias to develop on a trade over 1.2187 and the downside bias to escalate under 1.2074.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire