EURUSD Nears 1.20 Ahead of Powell’s Testimony

Summary:

EURUSD bullish price action continues as we get closer to the end of the month trading. The main London fix today is crucial.

Another day, another high for the EURUSD pair. In nears 1.20, and buyers keep putting pressure on each and every dip. This week is Powell’s testimony that may send the USD lower across the board.

The focus this December is what the Fed will do next. The rumors in the market are that the Fed will increase the pace of the QE and will also start a so-called “operation twist” by swapping short-term Treasuries with longer-term ones.

This week’s testimony may bring light into what the Fed intentions are, and therefore EURUSD traders will have more info ahead of the ECB and Fed decisions later in the month. At this point, with the pair trading close to 1.20, shorting the pair looks more attractive, despite its bullish bias.

EURUSD Technical Analysis

There is no doubt that the EURUSD is bullish as suggested by the price action. Because this is the last trading day in the month, we may have some increased volatility as we get closer to the main London fix. The chances are that the EURUSD will push to 1.20 on options-related strength. If so, bears may want to initiate a short position with a stop at 1.21 and targeting 1.18. Also, by the time the price breaks below the rising trendline, bears may want to add for the same target.