Search ForexCrunch

The American dollar kept advancing against its major rivals at the beginning of the week, with EUR/USD falling to 1.1621, its lowest since late September. European October Markit Manufacturing PMIs were upwardly revised while looming US presidential election keeps investors in cautious mode, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“The main focus is the US presidential election, with voting ending this Tuesday, and the first results coming out on Wednesday. However, the final result may take up to two weeks, amid mail-in votes counting within the pandemic context. Majors are expected to remain within familiar levels ahead of the outcome.”

“In the data front, Markit published the final versions of the European October Manufacturing PMIs, which were upwardly revised. The German Index came in at 58.2, while the European one printed at 54.8.  Markit will publish US data after Wall Street’s opening, with the index anticipated to remain steady at 53.3. Also, the US will publish the official ISM Manufacturing PMI, seen at 55.8 from 55.4 in September.”

“The 4-hour chart shows that technical indicators remain directionless and near oversold readings, indicating an absence of buying interest. The 20 SMA heads firmly lower below the larger moving averages and currently around 1.1690, providing strong dynamic resistance in the case the EUR/USD pair advances further.

“A slide below the 1.1621 daily low should open doors for a steeper decline towards a long-term static support area at 1.1460/70.”