EUR/USD: the pair remains undecided

Risk aversion, bullish recovery of risky assets... last week was a laborious one in terms of clear market guidance. On the one hand, the arrival of the vaccine is exciting traders, on the other hand, the short-term economic risk is still present.

It is in this uncertain context that the EUR/USD evolves with, in the background, injections of the FED, its will not to reduce anything for the moment and a possible return of a fiscal stimulus plan file. Joe Biden had planned $3 trillion and discussions should resume soon. This returns the small risk aversion observed in recent days with a mechanical upward trend in the short term. But this rise is limited by no less encouraging prospects for the Eurozone.

Moreover, this monetary support situation is opposed to a decision by the US Treasury to deprive the FED of support funds. This information came a few hours after the intention to restart discussions on the fiscal stimulus package.

KEY CHART ELEMENTS

With this scattered data, it is clear that the euro-dollar has no real future direction. On the one hand, the short term dynamic is certainly bullish above 1.1746 but still neutral in the medium term between 1.20 and 1.16 and has been so for months now. The proximity of the resistance zone of 1.1.1873 does not incite traders to take any initiative, other than offensive but counter-current short positions. We've been on the sidelines for a while now and will remain so, especially as the oscillations are only a few pips every day, without really leaving any room for trading. Hopefully, this week will be more dynamic and will give more telling technical hints.

MEDIUM TERM FORECAST

In view of the key chart factors we have mentioned, our opinion is neutral in the medium term on the EUR/USD's exchange rate.

We will maintain this neutral view as long as the pair is positioned between support at $1.1746 and resistance at $1.1873.