FX.co ★ Trading recommendations of EUR/USD and GBP/USD pair on 11/26/20

Past review for the EUR/USD pair

The EUR/USD pair has been showing active upward interest for a long time, which is similar to a progressive move. Since this month started, the Euro has strengthened by more than 300 points (+2.7%), which is considered a strong price change.

What was published on the economic calendar?

Yesterday was filled with US statistics data, where support for the US dollar was expected, but everything did not go as smoothly as traders wanted.

A key event was the publication of the second estimate of US GDP for the third quarter, where it was predicted that the pace of the economic decline would continue to slow down, but we remained at the level of the first estimate, which likely upset investors.

The second important factor that put pressure on the US dollar was the publication of the US labor market report on the volume of applications for unemployment benefits, where the data came out worse than expected.

• Initial applications was expected to decline by 12 thousand, but their volume increased by 30 thousand – from 748 thousand to 778 thousand.
• Repeated applications recorded a decline by 299 thousand, instead of the expected decline of 370 thousand (6,370 thousand ---> 6,71 thousand).

The only thing that came out better than the expectations for the US was the volume of orders for durable goods, which increased immediately by 1.3%, although the forecast was only 0.8%.

Against this background, positions of the US dollar continued to decline.

What happened on the trading chart?

The quotes of the euro/dollar remained at the range of 1.1900/1.1920, which was successfully broken. Thus, buy positions were considered after holding the price above the level of 1.1930.

Past review for the GBP/USD pair

The pound showed both downward and upward activity yesterday, but as a result, the quote remained within the limits of the previous range of 1.3300/1.3400.

There was only US statistical data in terms of economic calendar. They turned out to be worse than forecasted, which had a negative impact on dollar positions.

• USA 13:30 Universal time - GDP (Q3) second estimate
• USA 13:30 Universal time - Claims for unemployment benefits
• USA 13:30 Universal time - Orders for durable goods for October

Considering the dynamics of the trading chart, it can be seen that there was a local weakening of the pound, before the statistical data were published. This was probably due to the information flow, where the head of the European Commission, Ursula von der Leyen, said that the Brexit negotiations are in a decisive phase, but not all issues have been resolved yet.

What happened on the trading chart?

Before the US session began, the quote was actively declining towards the level of 1.3300, which was followed by a reversal in the direction of the level of 1.3400. Here, the quote follows the established range for the fourth day in a row, where the dynamics is limited by local activity.

Trading recommendations for EUR/USD pair on Nov 26

Looking at the economic calendar, we only have data on the European lending market, where no changes are expected. It is also noteworthy that the United States is closed today to celebrate Thanksgiving. Therefore, trading volumes may be reduced without a key player in the market.

From a technical viewpoint, all hope is directed to the previously set inertial move, which has already managed to consolidate above 1.1930. If the upward pace is maintained, buyers may see growth towards the values of 1.1950 and 1.2000.

An alternative scenario will be considered depending on a typical slowdown due to the lack of trading volumes on the market.

Trading recommendations for GBP/USD pair on Nov 26

Considering the economic calendar, we do not have statistics for the UK today. It should be recalled that today is a holiday in the US, which will affect trading volumes throughout the currency market.

In terms of technical analysis, we can see that the level of 1.3400 is still putting pressure on long positions, which is reflected in the trading chart in the form of a slowdown followed by a price rebound.

The price levels of 1.3300 and 1.3400 will continue to serve as a kind of barrier for market participants, where working on the tactics of rebounding from the borders and on the breakdown can be considered. It should be noted that the tactic of working on the breakdown of the established boundaries is considered the most optimal and less risky.