Forecast for EUR/USD on September 28, 2020

EUR/USD

The euro closed below the target level of 1.1650 last Friday, despite a weak report from the US. Orders for durable goods rose 0.4% m/m in August against 1.1% expectations. The debate on Wednesday between presidential candidates Joe Biden and Donald Trump will be the main event of the first half of the week. And since Trump has not yet formalized his understanding of the "strong dollar", markets will be guided by the degree of risk to themselves in the event of a verbal victory of one of the candidates. In case stock indices grow, the euro may also go up. The euro's external behavior corresponds to the scenario of such a tactic of investors; it occurs regularly before strong news - buying dollars, before their subsequent exchange for euros. But unless the debate reveals a winner, investors will continue to move away from dollar risk. Accordingly, we expect the euro to decline to the first target of 1.1550 and, possibly after the debate, to 1.1480.

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A double convergence of medium strength has formed on the four-hour chart, which still keeps the euro from rapidly falling. The price is likely to stay below the 1.1650 level before it continues to fall.

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