**EURUSD and DXY: Key Technical Levels Ahead of November Trading**
*By Justin Bennett, as originally detailed on Daily Price Action*
The early November forex landscape presents pivotal technical setups for both the EURUSD and the US Dollar Index (DXY). As market participants recalibrate following key US economic data and central bank signals, traders are closely watching several essential support and resistance zones that may guide near-term price action. This analysis, originally authored by Justin Bennett at Daily Price Action, dissects the technical environment shaping the world’s most traded currency pair and the benchmark US Dollar Index.
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## Context: Market Drivers into November
Before diving into specific price levels and chart formations, it’s important to contextualize recent price action. Several macroeconomic factors have influenced FX markets in the run-up to November:
– The Federal Reserve’s ongoing communication regarding interest rates and inflation containment
– Eurozone macro releases, particularly concerning growth and inflation
– Safe-haven flows into the US dollar amid global geopolitical uncertainties
– Shifts in risk sentiment driven by equity markets and energy prices
With these themes in motion, both EURUSD and DXY have reached critical junctures on the charts.
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## **EURUSD: Key Technical Levels and Price Outlook**
The EURUSD pair entered early November at a crossroads, having bounced from recent lows but still entrenched in a broader downtrend. Price structure suggests both opportunities and hazards for bulls and bears alike.
### **Daily Chart Analysis**
Recent months have seen the euro surrender ground to the dollar, pushing EURUSD beneath major support levels. However, late October into early November brought signs of stabilization, with buyers stepping in above a notable multi-month floor.
**Critical Levels to Watch:**
– **Immediate Resistance: 1.0690 Region**
– The area between 1.0680 and 1.0700 has repeatedly been tested as resistance since late September.
– This level previously acted as support, making it a significant pivot. Break and close above could open the door for additional upside.
– **Next Resistance: 1.0765**
– This area corresponds to a swing low in mid-September and a pre-breakdown consolidation in October.
– Bulls should monitor this level for profit taking or fresh selling pressure.
– **Major Resistance Zone: 1.0830 to 1.0860**
– Represents a confluence of former range support and the descending trendline from summer highs.
– A decisive break above here could signal a more substantial recovery toward 1.0940.
– **Support: 1.0530 to 1.0555**
– Buyers repeatedly absorbed selling in this band during October.
– Sustained weakness below this region may trigger a retest of yearly lows.
– **Major Support: 1.0440**
– The October low and a level not seen since late 2022. Loss of this support could deepen the euro’s decline toward 1.0350.
### **Technical Patterns in Play**
– **Descending Trendline:** A bearish trendline from July’s swing highs continues to cap upside attempts.
– **Double Bottom Potential:** Recent rebound attempts above 1.0530 hint at possible basing, but confirmation requires a break above resistance levels, especially 1.0700.
– **Downtrend Continuation Risks:** As long as EURUSD remains below the aforementioned resistance clusters, the broader bias remains with sellers on rallies.
### **What to Watch for Bulls:**
– A daily close above 1.0700 and then 1.0765 could invite further buying interest
– RSI divergence, if present, would add weight to a bullish countertrend view
– Potential for profit-taking by dollar bulls amid stretched sentiment
### **Risks for Bulls:**
– Failure to hold above 1.0530 would reaffirm downside momentum
– The fundamental backdrop continues to favor the US dollar given growth and rate differentials
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