HomeContributorsFundamental AnalysisEURUSD Holds Steady As The German Vote Count Continues

EURUSD Holds Steady As The German Vote Count Continues

The US dollar index rose slightly in the overnight session as investors remained wary about the ongoing gridlock in Washington. In the past few weeks, divisions have emerged between moderates and progressive Democrats about how to fund the $1.5 trillion infrastructure package and the anti-poverty bill. Also, there is an ongoing risk of a government shutdown since Democrats hold a slim majority in the Senate. Should that happen, the biggest risk will be that the Treasury will run out of money needed to pay its debt. At the same time, there are concerns about the collapse of Evergrande after the company failed to pay its interest payout.

Cryptocurrency prices rebounded during the weekend as investors reflected on the decision by the People’s Bank of China (PBOC) to ban all transactions. The announcement, which happened on Friday, led to a major sell-off in cryptocurrencies. Bitcoin rose above $43,000 in the overnight session while the total market capitalization of all cryptocurrencies rose to more than $1.9 trillion. Analysts believe that the new announcement by Chinese authorities will not have a major implication on Bitcoin because the government had already banned the coins before.

The euro rose against other currencies like the US dollar, sterling and Swiss franc as the market waited for the outcome of the German election. As of this morning, the winner was not yet made public although Armin Laschet of CDU/CSU and Olaf Scholtz of the Social Democrats claimed to have won the election. According to ARD, a broadcaster, put SPD in the lead with a 25.8% share. Therefore, there is a likelihood that it will take several days before the official results are announced.


The GBPUSD pair retreated in early trading ahead of the latest US durable goods order numbers. It is trading at 1.3665, which was lower than last week’s high of 1.3750. On the hourly chart, the pair declined below the 25-day and 15-day moving averages while the Relative Strength Index (RSI) and MACD declined. Therefore, the pair’s path of least resistance will be to the downside. The key level to watch will be 1.3620.


The AUDUSD pair remained under pressure after relatively weak China industrial profits numbers. The pair declined to 0.7260, which was slightly below the key resistance at 0.7315. It is slightly below the key 25-day moving average while the MACD and the Relative Strength Index (RSI) are at a neutral level. Therefore, the pair will likely remain in the current range ahead of the upcoming US durable goods order numbers.


The EURUSD pair rose after the latest German election. It is trading at 1.720, which is slightly above last week’s low of 1.1683. On the four-hour chart, the pair is still inside the descending channel shown in green. It is also below the short and longer moving averages and slightly above the middle line of the Bollinger Bands. The MACD and the Relative Strength Index (RSI) are also rising. The pair will likely show some volatility as investors reflect on the outcome of the election.

Octa (formerly OctaFX) is an international broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and a variety of services already utilised by clients from 180 countries with more than 40 million trading accounts.

Featured Analysis

Learn Forex Trading