EUR/USD analysis and weekly forecast for 05 – 09 November, 2018
Last week nonfarm payrolls report gave a strength to DXY. But trade war with China didn’t allow dollar to gain momentum. Coming week is very important and finally all pre-election madness will finish. We will have clear fundamentals and technicals for swing trades. I am not ready to bet or make forecast on elections results. And to be honest I don’t care. Even if Democrats win the House, it will not change global trends. Yes, there will be big jerk reaction, but it will fade fast.
One more important event is FOMC announcement. I don’t expect much volatility, because there will be no press conference. Based on recent nonfarm payrolls report I think we will see one more interest rates hike this year. As labor market is strong and the only indicator that disappoints is consumer spending weakness.
Elections can cause some unpredictable moves in the market. But from technical point of view I see 2 possible scenarios of EUR/USD move.
First one (and I think likely this will take place) is corrective ABC structure that started last Friday with A at Friday’s low, B – 1.14250 and C – 1.1335 and impulsive wave up to 1.15000 after it. Another scenario is consolidation in the range 1.13700 – 1.14200 and gaining momentum to break up to 1.1500. Then corrective ABC structure with A at 1.14200, B – 1.14600 and C at 1.13700 and next wave up. So, my advice is to watch price action on Monday to understand what scenario will take place and trade accordingly. As always I want to remind you that mentioned levels are average of price range and reversal points or entries can be a bit higher or lower.
Good luck and good trading to all!