On Friday the 9th of November, trading on the EURUSD pair closed down. The euro took a dive on the back of a broadly stronger dollar, along with a weakening pound and Canadian dollar, which dragged the market down with it.
Today, the euro dropped from 1.1369 to 1.1316. The British pound has fallen to 1.2958. This drop came after reports of UK Minister for London Jo Johnson’s resignation, who left his post saying that he cannot support the government’s Brexit deal.
Day’s news (GMT 3):
- 12:00 Eurozone: ECB Vice President Luis de Guindos speech.
- 22:30 US: FOMC member Daly speech.
- 24-hr US: Veterans Day.
Fig1. EURUSD daily chart.
On Monday, the dollar continued on its upwards trajectory against the majors, including the euro. The pound is falling and dragging all other currencies down with it. The dollar is being propped up by expectations of further interest rate hikes.
The EURUSD pair has dropped to 1.1269 today. I’ve shown the daily chart above in order for you get a better idea of the bigger picture. The trend line was broken through on the 24th of October. The bulls tried, and failed, to get the rate back to this level. The rate instead dropped to 1.1268, and is currently sitting around the lower line of the B-B channel.
The economic calendar is virtually empty today. There’s a small chance of a rebound from the line. If we look at the bigger picture, the euro looks poised to drop to 1.1050. 1.1160 will provide some intermediate resistance.