EUR/USD: The key barrier in the 1.19 area keeps limiting extra gains

EUR/USD extends the consolidative fashion on Friday as the pair once again prolongs the rangebound trade at the end of the week and always below the 1.19 mark, which has become a solid obstacle for any serious bullish attempt in past sessions, FXStreet’s Pablo Piovano reports.  

Key quotes

“Investors continue to look past the pandemic and favour the ‘glass half-full’ vision, always on the back of rising hopes of an effective vaccine in the short-term horizon, which at the same time reignite the idea of a ‘V’-shaped recovery in the euro area and the rest of the world.”

“Dark clouds for the single currency have started to emerge on the horizon, however, pari passu with the potential re-emergence of political effervescence in the Old Continent with the EU Recovery Fund and Hungarian and Polish vetoes in the centre of the debate.”

“The inability of surpassing the 1.19 area in the near-term carries the potential to motivate sellers to return to the market and sponsor a new corrective downside. In this scenario, initial support emerges at last week’s lows in the 1.1750 region ahead of the contention area near 1.1700, where coincide the 100-day SMA and a Fibo retracement (of the 2017-2018 rally). The loss of this level could pave the way for a deeper pullback to the monthly lows near 1.16 the figure (November 4).”

“On the upside, 1.19 remains a tough nut to crack for EUR-bulls. If and when this level is cleared, then the attention should shift to the monthly peaks around 1.1920 (November 9) ahead of the August’s top at 1.1965.”