The Census Bureau in the US just published the retail sales data for October, which missed the preliminary market forecasts. According to the findings of the report, the index recorded a marginal growth of 0.3 per cent vs 0.5 per cent expected.
The observed performance marks a drastic deterioration from a month prior when the retail sector enjoyed a better-than-expected growth of sales reaching 1.6 per cent.
Consumer spending was stifled last month due to a series of contributing factors. Namely, the lack of comprehensive fiscal policy by the government, which is also weighing down on FED's monetary policy, coupled with the uptick of COVID-19 cases.
Dampened consumer spending rates could persist in November, despite Joe Biden's decisive victory in the election and the promising vaccine news of the last few days, owing to the constant coronavirus fallout. Not even the bolstered investors' enthusiasm in the short run can offset its negative impact.
Meanwhile, the greenback continues to reel from these recent developments, and the weaker-than-expected retail sales data from today can only exacerbate its struggles.
As can be seen from the hourly chart below, the EURUSD took a new turn following the release of Moderna's data. The underlying price action rebounded from the 20-day MA (in red) and broke out above the major resistance level at 1.18700.
The pair continues to be advancing within the boundaries of an ascending channel, which represents a significant bullish confirmation, but it is about to test the strength of the latest Resistance Area (in blue). The latter could serve as a potential turning point.
It should be mentioned that while the price action remains concentrated above the 100-day MA (also in blue), the market bulls are likely to retain control. However, the MACD indicator is demonstrating exhaustive bullish momentum, which may not be enough for another breakout above the Resistance Area.