FX.co ★ Analysis and Forecast on EUR/USD for December 28, 2020

Today's review of the main currency pair of the Forex market will begin with an important message from the United States of America. So far, the current US President, Donald Trump, has signed a draft budget for next year, which includes a package of stimulus measures to counter COVID-19. The said package amounts to $900 billion. I would also like to draw attention to the fact that earlier Trump refused to sign this proposal, referring to the fact that one-time benefits for citizens whose annual income is below $75,000 should not be $600, but $2,000. As a result of the signed bill, it was possible to avoid a partial closure of state institutions due to the lack of their funding, that is, a shutdown. The current President took this step in exchange for a promise that the US Congress will pay serious attention to the violations that, according to Trump, took place in the last presidential election.

In Europe, preparations are in full swing for the start of mass vaccination against the coronavirus pandemic. However, about 1,000 doses of Pfizer vaccines in Germany were stored at temperatures below -70 degrees. Thus, vaccination is recommended to start in several German states since it is not certain that the vaccine, stored at an unacceptable temperature, has retained all its properties. Nevertheless, according to European Commission President Ursula von der Leyen, the vaccination plan for EU citizens has been drawn up and everything is ready for work. Europe will prioritize vaccination among the elderly who are in medical institutions, as well as staff who provide care for them. However, with regard to the vaccination of EU citizens, not everything is so clear and simple. According to surveys, only 41% are ready to get vaccinated, and 59% at this stage are afraid to do so. In my opinion, this is a consequence of various information in the media about this or that vaccine. I think it is no secret that the purchase of a particular vaccine requires huge funds, so there is a persistent struggle for sales markets, and the media play a very important role here.

Daily

Based on the technical picture of the main currency pair, the EUR/USD began the week with growth. The news of Trump's signing of the budget for 2021, which includes a new package of measures to support the national economy, inspired optimism, and supported the craving for risky operations among bidders. At the moment, the EUR/USD pair is trading above the red Tenkan line of the Ichimoku indicator, as well as above the maximum trading values of December 23-24. If the euro bulls manage to maintain and increase the current upward potential, the pair will probably re-believe the strength of the strong resistance of sellers at 1.2272, the true breakout of which will open the way to higher goals, namely, the price zone of 1.2300-1.2320.

H1

According to trading recommendations, I suggest looking for purchases of EUR/USD after short-term declines in the price area of 1.2225 and, possibly, lower, in the area of accumulation of hourly moving averages: 89 EMA, 50 MA, and 200 EMA, which are in the range of 1.2205-1.2190. There are also recommendations for sales. The nearest opening of short positions will be possible only when bearish candlestick analysis patterns appear in the resistance zone of 1.2256-1.2272 on the four-hour and/or hourly charts of this currency pair. Note that sales are the most risky positioning, as they are against the current upward trend, which is again gaining momentum.

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