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21.10.2020: EUR and GBP to go on rising? Outlook for EUR/USD and GBP/USD

Today, the US dollar showed a significant drop. Moreover, statistics from the UK has boosted the pound sterling. The UK inflation advanced even more than expected. Thus, the indicator climbed by 0.5% after a rise of 0.2% in the previous period. Economists had forecast a smaller increase of 0.4%. Thus, the already growing pound sterling has received additional support. Notably, the euro is also gaining in value. Moreover, the European Union has announced that it is ready to make new concessions and guarantees that the UK economic sovereignty will not be violated. All these decisions were made to resume the trade negotiations as soon as possible. The fact is that on November 15, both sides should present the final version of the agreement. It is quite possible that in the near future, there will be only positive news on the issue. Yesterday, the euro/dollar pair resumed rising and broke the local high of 1.1830 logged on October 9. On the trading chart, we can see that the quote touched the stagnation area of September 10-18. As a result, the price jumped above the level of 1.1850. This may lead to a drop in the number of long positions. That is why there are two possible scenarios. According to the first one, the euro/dollar pair may slow down between the levels of 1.1850 and 1.1900. In this case, the pair may show a drop. According to the second scenario, the price may consolidate above 1.1910 on the four-hour chart. This may change the downward trend that began in September. Let’s take a look at the pound/dollar pair. Yesterday, the pair got stuck. However, today, it is showing quite a high activity. The price consolidated above 1.3000 and approached the high of 1.3062 logged on October 12 and 14. If the pair fails to consolidate above 1.3080 on the four-hour chart, it may decline below 1.3000.

19.102020: EUR and GBP gain momentum. Outlook for EUR/USD and GBP/USD

Monday is supposed to be quite a calm day despite the fact that several representatives of the ECB, including Christine Lagarde, will provide a speech. Analysts do not expect any significant announcements. Nevertheless, the European currencies showed a jump. The pound sterling turned out to be the first to start gaining in value. This could be triggered only by changes in the Brexit issue. The fact is that Boris Johnson has made an announcement that contradicts the speech he provided on Friday. Thus, the UK Prime Minister has said that London is ready to make adjustments in the Internal Market Bill in order to reach an agreement with the European Union. Of course, such news has boosted the British pound and the euro. However, it is still unknown what changes will be made in the bill. That is why after a rise, the market will wait for another portion of comments that will shape sentiment of market participants. Investors are likely to get new information only tomorrow. The pound/dollar pair is still under the speculative influence that increased amid the news flow. At the beginning of the European session, the pound/dollar pair returned to the level of 1.3000. If the price consolidates above 1.3000, it may hit the local high of 1.3080. However, traders may close their long deals soon that could lead to a pullback. Trading volume may drop between such levels as 1.3000 and 1.3080. At the same time, the euro/dollar pair also climbed towards the high of 1.1746 logged last Friday. If the price consolidates above 1.1750, it may jump to 1.1770. Otherwise, the pair may drop to 1.1700.

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