EUR/USD - 4H.
On December 4, the EUR/USD pair performed an increase to the Fibo level of 50.0% (1.1080). However, this level did not become any strong barrier for the euro-dollar pair. At least, a pronounced rebound from it did not happen, but now the quotes can perform a reversal in favor of the US currency and resume the process of falling. It is difficult to say how long it will last and how strong it will be, as the pair closed over the downward trend corridor, indicating a desire to start an upward trend.
The information background can now be safely identified with only one figure on the world stage - with Donald Trump. The US president likes to be on the front pages of all periodicals, so he continues to distribute comments in which he criticizes half the world, not forgetting "his own garden" - the Fed and Jerome Powell. However, there is no shortage of Trump's actions by US trade partners. The American president imposed duties against Argentina, Brazil, Turkey, China; he is preparing to impose duties on France, as well as automotive products from the European Union. Not to mention the expansion of the trade war with China, which according to Trump, is not too zealously seeking to conclude a trade deal with America, which in the first place "is very necessary for China." Traders do not pay too much attention to this information, reasonably believing that economic reports are much more important. However, reports are not available every day. Yesterday, for example, there was none, as a consequence - weak activity of traders throughout the day.
Today, the information background should be more interesting. There will be several indices of business activity in the eurozone in the services sectors of different countries. Fortunately for the euro currency, while most of these indices are kept above the level of 50.0, so it is too early to talk about the decline in the services sector. However, it is impossible to ignore the negative trend of business activity in the service sector. Not too fast, but the indices are falling, bringing the entire industry closer to a period of recession. On Monday, business activity in the manufacturing sector encouraged traders a little, but it cannot be said that much. Today, business activity in the service sector at best will not disappoint, at worst - will come close to the level of 50.0. But the US business activity indices, on the contrary, are in excellent condition. The ISM index is now 54.7 and Markit is 51.6. Even a small decline in business activity in the US services sector is unlikely to cause serious disappointment among traders. As a result of the analysis, I believe that the information background will be on the side of the US currency today. It remains only to wait for the economic reports themselves.
Forecast for EUR/USD and trading recommendations:
On December 4, traders will try to turn the pair down. Thus, an attempt to overcome the correction level of 50.0% (1.1080) can be considered unsuccessful or false. If so, then today again it is necessary to sell the pair with the targets of 38.2% (1.1057) and 23.6% (1.1030) and the stop-loss order above the level of 1.1080.
The Fibo grid is based on the extremes of October 21, 2019, and November 29, 2019.
