EUR/USD - 4H.
On December 20, the EUR/USD pair performed a fall under the correction level of 50.0% (1.1080), however, today it performed a reversal in favor of the European currency and began the process of growth in the direction of the correction level of 61.8% (1.1104). Emerging divergences are not observed today in any indicator, but I am still waiting for the resumption of the process of falling quotes of the pair. At the same time, now this will require a signal about the completion of the pullback up, for example, the rebound of the euro-dollar pair from the Fibo level of 61.8%. This week, there will be an extremely small number of economic reports. The holidays begin, so I expect a drop in traders' activity.
Last Friday's economic reports showed once again that America is doing well. After the Fed cut rates three times, the US economy is again showing growth and acceleration. The latest data on GDP, personal income and spending of Americans, as well as indices of spending on personal consumption, showed that the US population continues to spend, spends in sufficient quantity, incomes are growing, and GDP is at a good level. Thus, the growth of the US dollar on Friday was expected, given the information background. Another thing is political news, which either fortunately or unfortunately does not particularly affect the movement of the pair. However, they can start to affect at any time.
I have already talked about the whole situation around the impeachment of Donald Trump, as well as the very personality of the US President. Given his way of doing business, it is not surprising that charges are brought against him, constant conflicts and scandals are connected with his name, both with the political forces of his own country and with the governments of other countries. For example, the Speaker of the House of Representatives Nancy Pelosi, whom Trump has repeatedly openly called "crazy". Although Donald Trump considers himself innocent of everything he is accused of, his defiant behavior further incites opposition political forces in the United States against him. The Democratic Party, which initiated the whole procedure of impeachment, will now play this medium-sized trump card with great care and caution, realizing that there may not be a second chance. Democrats are well aware that it makes no sense to refer the case to the Senate, in which 53 senators are Republicans. At least in its current form and right now. Thus, the Democrats delay the process and formally have the right to delay it as much as necessary. It works against trump's time. Trump needs to resolve as quickly as possible all the political, foreign economic differences in which he embroiled the country during his presidency. Otherwise, he may be disappointed in the 2020 election. Democrats can now search as much as they want for new evidence of Trump's guilt, new witnesses, new information. The only chance to unseat Trump from his post is to find indisputable evidence of his guilt. If this is not possible, it is necessary to lower his political ratings and popularity among the population as low as possible so that he could not be re-elected for a second term.
Forecast for EUR/USD and trading recommendations:
On December 23, traders will try to continue the fall of the euro-dollar pair, although the latest events related to the American President are beginning to openly alarm. Too much negativity is associated with the name of Trump. Nevertheless, economic data in America remain at a high level, which supports the demand for the US currency. I recommend today to wait for the completion of the pullback up and resume selling the pair with the targes of 1.1057 and 1.1030.
The Fibo grid is based on the extremes of October 21, 2019, and November 29, 2019.