Good US construction performance came out on Friday last week: 1.608 million y/y were pledged in December against new expectations of 1.38 million y/y – this is the highest figure since January 2007; 1.42 million were issued for new construction permits y/y (forecast was 1.47 million). Industrial production failed – the December decline was -0.3% versus the expected 0.0%, but optimistic investors found positive in the index structure – production in the manufacturing industry increased by 0.2% against the forecast of -0.2%. As a result, the dollar index grew by 0.33% while the euro lost 45 points.
On the daily chart of the pair, the signal line of the Marlin oscillator penetrated into the negative trend zone. An important support is the 1.1074 level – the area of the Fibonacci line of 123.6% and the line of MACD. Overcoming support will open an equally important goal at 1.1034 – an embedded price channel line, overcoming of which, in turn, opens the way for pulling down the euro in a medium-term..
On the four-hour chart, the MACD blue indicator line is turning down, the price is also under the line of balance. Marlin consolidated in the decline zone.
It is a national holiday in the US today, and there are also no important events expected in the euro area. A calm day (consolidation) is expected on the market before tomorrow’s attempt to overcome technical support (1.1074).
The material has been provided by InstaForex Company – www.instaforex.com
Source:: Forecast for EUR/USD on 1/20/2020