EUR/USD: confusion abounds in relation to the $1.1750 technical level

Equities, oil and the euro aligned their very short-term positive orientation, in a market that is not calmed down for all that. Trump's triumphant release from the hospital after just three days will have brought some relief to Wall Street, less than a month away from his battle against Biden for the presidency. Also under the watchful eye of investors, Democrat Congressional Leader Nancy Pelosi and Treasury Secretary Steven Mnuchin resumed talks Monday on the new economic aid plan.

Disagreements remain numerous but political leaders are doubling their efforts in the run-up to the upcoming election. "The polls have not been very favourable to Trump lately, this could encourage Republicans to find a compromise with the Democrats," says David Madden. Last weekend, Steven Mnuchin, who negotiates for the Trump administration, had already taken a step towards the Democratic camp by agreeing to increase the global support plan budget, from 1 trillion dollars - the limit initially set by the Republican camp - to $1.7 trillion, according to several news sources.

On the statistical front, the latest signals to date were rather favourable, with activity indicators higher than expected in services (47.9 for the PMI IHS Markit for the whole of the Monetary Union), retail sales dynamics higher than expected (+4.3% in monthly rhythm in August versus +2.3% expected. Target also beaten for the Sentix investor confidence index. On the other side of the Atlantic, the services PMI (ISM) also beat expectations by one and a half points. Also, an interesting signal on the side of German industrial orders, up by 4.4% in August, in monthly rhythm well above the consensus (+2.9%).

Right now, the pair is trading at around $1.1784.

KEY CHART VIEW
Traders will prefer to stay out of this currency pair for the time being.

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 it is positioned between support at $1.1745 and resistance at $1.1900.