13.11.202009:31 Forex Analysis & Reviews: Hot forecast for EUR/USD on 11/13/2020

Although a lot of extremely important macroeconomic data were published yesterday, the single European currency essentially stood still. This clearly demonstrates the fact that the market is still at the mercy of total political uncertainty related to the fate of the US presidential elections. The process is clearly delayed. For example, all votes will be manually recounted in Georgia. So Donald Trump got his way. Even if it is only in one state. But this sets a precedent, and other states may follow the same path. However, this will lead to an even greater delay in the vote counting procedure, and with a completely unpredictable result. So it is not surprising that investors simply do not understand where to go and what to do. We must admit that yesterday's macroeconomic data came out significantly worse than forecasts. Moreover, both in Europe and in the United States. Although weak reports explain the final result, the complete absence of any activity at the time of publication of the data still speaks of the prevalence of political factors.

In regards to European statistics, the decline has intensified. It was expected that the rate of decline in industrial production would slow down from -6.7% to -5.4%, but it turned out that they accelerated to -6.8%. So the situation in the European economy is only getting worse. Although the re-introduction of quarantine measures contributes to the worsening of the situation. However, the data is for September, and the quarantine was introduced in October, and it will only produce an effect in November. And the decline intensifies before that. So by the end of the year, European statistics will look much worse.

Industrial production (Europe):

At the same time, US inflation turned out to be even more disappointing. The growth rate of consumer prices slowed down from 1.4% to 1.2%. And this despite the fact that inflation was projected to accelerate to 1.5%. True, it should be noted here that US inflation had been accelerating for four consecutive months. So it is too early to panic about the current slowdown. Although the news is still unpleasant. At the same time, data on the labor market turned out to be better than forecasts. The number of initial applications for unemployment benefits fell from 757,000 to 709,000. The number of repeated applications decreased from 7,222,000 to 6,786,000. But the market did not react to this. Endless vote counting is much more important now.

Inflation (United States):

The second estimate of the euro area GDP for the third quarter will be published today, which should coincide with the first, which showed a slowdown in the rate of economic decline from -14.8% to -4.3%. Although even if it were not for this whole political circus with the US presidential elections, this data would still not affect investor sentiment. After all, we are talking about the second assessment, which must coincide with the first. And the market has already taken it into account.

GDP change (Europe):

Apparently, US statistics will not make any impression either. After all, if inflation was ignored yesterday, then producer prices, whose growth rates should remain unchanged, will generally go unnoticed.

Producer prices (United States):

After an intensive downward move in the period of November 9-11, the EURUSD pair found a support point within the value of 1.1745, where a stop occurred and a pullback of 1.1745 ---> 1.1823 occurred in the period of November 12.

If we proceed from the quote's current position, we will see another stagnation in the range of 1.1787/1.1823, where fluctuations have halved during the Asian session. Pressure on the range can signal the accumulation process, which will result in acceleration.

Relative to the market dynamics, a local surge in activity is recorded in yesterday's European session, while the overall dynamics are below the average level.

Looking at the trading chart in general terms (daily period), you can see the correction process relative to the upward movement of the past week.

We can assume that the boundaries of the 1.1787/1.1823 range will hold back speculators for a while, but the process of long-term accumulation of trading forces will lead to local activity in the direction of a breakdown. The most optimal trading tactic will be the method of breaking through a particular stagnation border, with a local entry into the trade.

From the point of view of complex indicator analysis, we see that the indicators of technical instruments have a variable buy signal due to the price movement along the trajectory of 1.1745 ---> 1.1823.