4-hour timeframe

Technical details:

Higher linear regression channel: direction - upward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 229.8809

The second trading day of the new week for the EUR/USD pair was not at all in the trading that we expected to see. We expected to see a continuation of the downward movement that has begun because there is no fundamental basis for further growth of the euro currency. However, instead of falling, the euro/dollar pair again rushed up in the first half of the day, and in the second – tried to start a new round of corrective movement. All this happened above the moving average line, so we can say that the upward trend has continued. Therefore, we can't even conclude that a new downward trend may start yet. The pair is trading near its two-year highs near the psychological mark of 1.2000. We still wonder what makes traders buy the euro and sell the dollar.

As we said yesterday, it may not be a matter of wanting or not wanting to invest in the dollar. This may be due to major players in the foreign exchange market who have information that ordinary traders do not have. Also, major players can buy billions of euro currencies to diversify future risks if we are talking about commercial companies. Thus, although the strengthening of the euro currency looks strange at first glance, we remind traders that any fundamental assumption requires technical confirmation. At the moment, there are none. This means that whatever the fundamental background, it is still recommended to trade higher.

Meanwhile, Fed Chairman Jerome Powell made another very pessimistic statement. Powell believes that the next few months will continue to be very difficult for the American and global economy due to the pandemic and although several highly effective vaccines have been invented. "The latest news about vaccines is positive, but only in the medium term. At the moment, significant difficulties and uncertainties remain, including the timing of the introduction of vaccines, their production, and distribution, as well as their effectiveness for various population groups," the text of Jerome Powell's speech to the US Senate banking committee says. According to Powell, the emergency stimulus programs that were launched this spring gave businesses and authorities access to almost $ 2 trillion and these programs need to be preserved. In other words, Powell still believes that the economy needs to be stimulated, without which the pace of its recovery may slow. And if a second "lockdown" is introduced, the American economy may start to shrink again, as the European one is doing now. Powell also recalls that the Congress and the Senate should adopt a new package of assistance to the economy, which was frozen shortly before the start of the presidential election, as Republicans and Democrats could not agree on its volume.

Meanwhile, the current President of the United States continues what is called "bending the line". Even though Trump agreed to launch the process of transferring power to Joe Biden, he continues to claim that the Democrats rigged the election. Recently, Trump has significantly reduced the number of interviews and comments. If earlier Twitter was just bursting with a daily stream of messages from the White House, now it is relatively calm. The same applies to media interviews. After November 3, Trump gave only a couple of interviews. In the last of them, given to Fox, Trump again said that the election was rigged, and his team has a large amount of evidence of the Democrats' guilt. Remember that immediately after the results of the vote count became known, Trump also spoke about the huge amount of evidence that he promised to present "next week"? This time, Trump complained that all the courts to which his team appeals reject the claims and do not even want to consider them and take into account this very evidence. The President also complained to the FBI and the Justice Department, accusing them of "not helping him." So, now Trump is going to go to the Supreme Court of the United States. However, most experts and political scientists now believe that time is irretrievably lost, and there is very little support for Donald Trump to launch a high-profile process of reviewing the election results in at least several states.

Meanwhile, many experts are trying to understand the question of why Donald Trump so unexpectedly won the 2016 presidential election, a man who always went against the rules It is indeed rare for America that a President is not re-elected for a second term. After all, in essence, this means that the American nation is dissatisfied with the way the President led the country. The maximum number of years a President can remain in power is 8 years or 2 terms. Most American presidents just spent 8 years in the White House. Donald Trump, according to many experts, was destroyed by his war with the media and journalists. In America, most media outlets, Newspapers, and TV channels are independent. Of course, they can support a particular candidate or political party. They may be supported financially by one or another political force, but they are at least relatively independent. Trump, instead of being friends with the media, made a bet (for some reason) on Twitter. It was through this social network that Trump intended to communicate with Americans. Further, through Twitter, Trump did not notify Americans about important decisions made by his administration. Through the main channel of communication with the American people, Trump blamed all those who refused to adhere to his point of view. He blamed and insulted the Democrats, China, the media (calling them false and fake), journalists, and anyone else he didn't like. As a result, the official account of the President began to be treated almost like a "yellow press", which people come to read to laugh. However, in the end, Trump managed to quarrel even with Twitter and Facebook. At first, the President started making unsubstantiated statements about future voting by mail in various states, and social networks were forced to start marking Trump's messages as controversial. After that, Trump signed an executive order to abolish censorship in social networks, after which Twitter and Facebook shares fell by several percent. And this meant the beginning of a war with the President. After that incident, both social networks began to mark the President's controversial messages much more often. And how would you feel about messages from the President of the country, which is marked "controversial"?

The volatility of the euro/dollar currency pair as of December 2 is 71 points and is characterized as "average". Thus, we expect the pair to move today between the levels of 1.1976 and 1.2118. A reversal of the Heiken Ashi indicator downwards signals a round of corrective movement.

Nearest support levels:

S1 – 1.2024

S2 – 1.1963

S3 – 1.1902

Nearest resistance levels:

R1 – 1.2085

R2 – 1.2146

R3 – 1.2207

Trading recommendations:

The EUR/USD pair resumed its increased upward movement. Thus, today it is recommended to stay in buy orders with targets of 1.2085, 1.2118, and 1.2146 until the Heiken Ashi indicator turns down. It is recommended to consider sell orders if the pair is fixed below the moving average with a target of 1.1902.