GBP/USD Confirms Support Around 1.2870
MaiMarFX | Oct 14, 2020 04:54AM ET
The U.S. dollarappreciated against its peers and short traders benefited from yesterday’s decline in the euro, cable and DAX.
The reasons for U.S. dollar’s fresh strength is on the one hand the worsening prospects for U.S. fiscal stimulus before Election Day and on the other hand safety concerns about the Covid-19 vaccine. Generally speaking, the USD serves as a safe haven in uncertain times against its major counterparts.
Regarding the upcoming November U.S. election, a “Democratic sweep” would weaken the USD but is seen as market-friendly, while a Trump win is considered a dollar-positive scenario.
Prospect of a Biden presidency is seen adding to the odds of a fresh round of fiscal stimulus, which would be favorable to markets.
Elsewhere, there was a record increase in coronavirus cases with European governments adding new restrictions to halt the contagion. Europe recorded 700,000 new cases last week, the most since the pandemic began.
h2 EUR/USD/h2The euro dropped below 1.1770, testing 1.1730 and traders now wonder whether there could be a slide toward 1.1570. If the euro breaks below 1.1690, we anticipate more bearish momentum to come. Above 1.1840, chances are in favor of a test of 1.1870/1.19.
Cable broke in short-term time frames below its support at 1.2950. A next support could now lie at 1.2870-50 while short-term resistances are seen at 1.2980 and 1.3020.
h2 Daily Forex Signals/h2EUR/USD
Long @ 1.1780
Short @ 1.1725
GBP/USD
Long @ 1.2965
Short @ 1.2890 DAX® (GER30)
Long @ 13060
Short @ 12980
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