03.12.202413:15 Forex Analysis & Reviews: EUR/USD. December 3rd. The Euro Falters at the Start of the Week

On Monday, the EUR/USD pair reversed in favor of the US dollar, initiating a new decline by closing below the 323.6% Fibonacci retracement level at 1.0532. A rebound from this level today would again favor the US currency, potentially leading to further declines toward the next level at 1.0420. Conversely, consolidation above 1.0532 could introduce potential bullish signals, complicating the current technical outlook.

The wave structure remains clear. The last completed downward wave broke below the previous wave's low, while the current upward wave has yet to breach the prior peak. As such, the pair continues to form a bearish trend. Bulls have lost market initiative, and breaking this bearish trend would require the pair to rise above 1.0611, which it failed to achieve last week.

Monday's news had traders' attention divided. While European reports were largely unremarkable, US data impressed. Bears attacked aggressively at the start of the trading week, even before key data was released.

Key reports revealed that:

• The ISM Manufacturing PMI rose significantly from 46.5 to 48.4, exceeding trader expectations.
• The S&P Global Manufacturing PMI increased from 48.5 to 49.7, also above forecasts.

Although both indices remain below the 50.0 level, which indicates contraction, the positive dynamics cannot be overlooked.

This morning, the dollar showed slight declines despite a lack of European news. However, this drop is unlikely to last long given the dollar's previous strength and traders' confidence in its trajectory.

On the 4-hour chart, the pair rebounded from the 100.0% Fibonacci retracement level at 1.0603, accompanied by a bearish divergence signal on the Commodity Channel Index (CCI). This resulted in a reversal favoring the US dollar, with declines targeting the 127.2% Fibonacci retracement level at 1.0436.

Consolidation below 1.0436 would raise the probability of further declines toward the 161.8% Fibonacci retracement level at 1.0225.

During the last reporting week:

• 5,698 long positions were closed.
• 29,422 short positions were opened.

The sentiment among speculators remains bearish, indicating further declines for the pair.

• Total long positions: 154,000.
• Total short positions: 197,000.

For ten consecutive weeks, major players have been reducing their euro holdings. This confirms the emergence of a new bearish trend.

The main driver of the dollar's recent decline—expectations of monetary easing by the FOMC—has already been priced in. Without new reasons to sell the dollar, further strength of the US currency appears likely. Technical analysis also supports the continuation of a long-term bearish trend for EUR/USD.

Economic Calendar for the US and EurozoneUS – JOLTS Job Openings (15:00 UTC)The economic calendar for December 3 features just one significant report, which could have a moderate impact on market sentiment.

EUR/USD Forecast and Trading Advice

• Selling opportunities: Short positions following a 4-hour chart rejection from 1.0603, targeting 1.0420 and 1.0320, remain valid.
• Buying opportunities: Long positions could have been considered following a rejection at 1.0420 or 1.0532, targeting 1.0662, but neither occurred.

Today, I do not recommend considering long positions.

Fibonacci Levels

• Hourly chart: 1.1003–1.1214
• 4-hour chart: 1.0603–1.1214

Traders are encouraged to monitor key zones closely and adjust strategies based on upcoming US economic data and technical signals.