EUR/USD: the trend is your friend

The Euro continued its flat consolidation against the dollar, the spot being subjected to headwinds after statistical indicators both likely to feed the appetite for risk, and therefore the single currency (Conference Board of household confidence, final US GDP Q3, reassuring PCE, manufacturing index of the Richmond Fed), and likely to reinforce the tightening of tone of the Fed, and therefore support the greenback, by the mechanics of the differential "remuneration" between currencies ...

Yesterday, weekly jobless claims across the Atlantic rose slightly, to 230,000 new units, provoking a renewed appetite for risk in the very short term, corroborating the adage "Bad news is good news". In fact, the market was expecting such a figure, with the consensus being exactly 230,000. Tensions in the labor market, which themselves generate inflation, are still strong. And the content of the monthly report next Friday (NFP for Non Farm Payrolls) will provide valuable information.

To be followed today is the publication of the Chicago PMI at 15:45 (Central European time).

Right now, the pair is trading at $1.0671.

KEY CHART ELEMENTS

The 20-day moving average (in dark blue) continues to play its role as chart support. A positive view remains above this trend line, which is moving in a straight line. We will monitor the attitude of the prices at the time of the contact, if necessary, with this trend line.

MEDIUM-TERM FORECAST

Based on the key chart factors we have mentioned, our medium-term view is positive on the EUR/USD.

Our entry point is $1.0664. The price target of our bullish scenario is at $1.1189. In order to preserve the capital invested, we advise you to position a protective stop at $1.0524.

The expected return on this forex strategy is 525 pips and the risk of loss is 140 pips.