EUR/USD to increase bearish potential below 1.18

The EUR/USD pair is under selling pressure, trading near the 1.1815 daily low, after Christine Lagarde, President of the European Central Bank, called for ‘priority’ fiscal support. EUR/USD is at risk of falling further, although lacking directional momentum, FXStreet’s Chief Analyst Valeria Bednarik briefs. 

Key quotes

“The EU published the September Current Account, which posted a seasonally adjusted surplus of €25.2 billion, below the market’s expectations. Meanwhile, ECB’s President Christine Lagarde offered a speech, reiterating the central bank will extend its monetary stimulus in December. Like its US counterpart, Lagarde said that fiscal support should be a priority.”

“The US has just published Initial Jobless Claims for the week ended November 13. The report showed that 742K people filled for unemployment, worse than anticipated. The country also published the Philadelphia Fed Manufacturing Survey, which came in at 26.3, better than the 22 expected. Pending for release is the October Existing Home Sales report.”

“The 4-hour chart shows that the pair is extending its decline below a flat 20 SMA, while technical indicators hover within negative levels. Technical readings indicate little directional interest at the time being, with the bearish case becoming firmer on a break below the 1.1800 figure.”