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19.11.202009:24 Forex Analysis & Reviews: Trading plan for EUR/USD and GBP/USD for 11/19/2020

Market's activity is so little that there is nothing to even talk about. Moreover, all these are just prolonged movements due to the current events which have been going in recent weeks. This is probably understandable, since the main deterrent is the ongoing political farce that began in the United States on the day of the presidential election. They still counted the votes, found lost ballots somewhere, and filed lawsuits in the courts. Overall, they did a lot of things, but no one can say what the actual result of these elections is. Due to this, the markets are completely confused and can't figure out where to run or what to do.

Exchange Rates 19.11.2020 analysis

The euro's standing still position is justified to some extent, since only the final data on inflation were published, which coincided with the preliminary estimate. The decline rate in consumer prices remained unchanged at -0.3%, however, all this was considered by the market during the publication of the preliminary assessment. Thus, the lack of reaction is quite understandable.

Inflation (Europe):

Exchange Rates 19.11.2020 analysis

The behavior of the pound was quite unusual. It slowly, but surely declined throughout the day and this despite the fact that inflation rose from 0.5% to 0.7%. It is logical that this should have contributed to the pound's growth; however, what happened was contradictory. Apparently, this is not due to the overall overbought pound, but rather with the oversold condition of the dollar, which simply has nowhere to fall.

Inflation (UK):

Exchange Rates 19.11.2020 analysis

At the same time, we have multi-directional US statistics. So even if a quite serious data were published, this would not affect anything either. In connection to this, the construction data were published, which practically did not affect investors' mood. Here, the number of new construction projects increased by 4.9%, with a forecasted growth by only 2.1%. But the number of issued building permits remained unchanged, albeit expected to rise by 1.3%.

New Home Construction (United States):

Exchange Rates 19.11.2020 analysis

Any clear dynamics are not expected today. If even yesterday's inflation failed to move the market from the dead point, then the data on applications for unemployment benefits is unlikely to succeed. Nevertheless, the number of initial requests may decline from 709 thousand to 685 thousand, while the number of repeated requests should be reduced from 6,786 thousand to 6,250 thousand. In short, the US labor market continues to recover steadily, which is entirely a positive factor. However, political tension and uncertainty about the election result in the US are now coming to the fore.

Repetitive Unemployment Insurance Claims (United States):

Exchange Rates 19.11.2020 analysis

The EUR/USD pair found the resistance level of 1.1893, which is the local high last November 17. After that, a stop emerged, followed by a price reversal towards the level of 1.1830. Now, if the price is kept below 1.1820, a further decline towards the range of 1.1800-1.1745 will be considered. An alternative scenario considers the variable gap of 1.1850/1.1890.

Exchange Rates 19.11.2020 analysis

In turn, the GBP/USD pair approached the resistance level of 1.3300, where there was a natural stop, followed by a rebound towards 1.3220. We can assume the quote must consolidate below the level of 1.3220 to further decline; otherwise, the gap within the limit of 1.3250/1.3300 cannot be excluded.

Exchange Rates 19.11.2020 analysis

*这里的市场分析是为了增加您对市场的了解,而不是给出交易的指示。

Mark Bom,
Analytical expert of InstaSpot
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