EUR/USD Forecast: EUR/USD gaining bearish traction near 1.1000
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UPGRADEEUR/USD Current price: 1.1028
- Germany confirmed the August Harmonized Index of Consumer Prices at 2% YoY.
- Speculative interest awaits the United States Consumer Price Index.
- EUR/USD pressures the 1.1020 support area, aims to break below it.
The EUR/USD pair is pressured, trading near its daily low at 1.1027. The US Dollar trades with a weaker tone against other major rivals on Tuesday, but the Euro can not attract investors. The looming European Central Bank (ECB) monetary policy announcement undermines demand for the Euro, as the ECB is widely anticipated to trim interest on the three benchmark rates by 25 basis points (bps) each. The latest data coming from the Eurozone fueled concerns about a potential recession in the area, which was led by an economic setback in Germany. An interest rate cut was priced long ago, yet recent concerns add to the Euro's weakness.
The US Dollar, in the meantime, is in no better shape. Market players are waiting for an inflation update, as the country will release the August Consumer Price Index (CPI) on Wednesday. Price pressures are expected to have eased further in the month, although the index is still foreseen above the Federal Reserve (Fed) goal of around 2%.
Data-wise, Germany confirmed that the Harmonized Index of Consumer Prices (HICP) rose at an annualized pace of 2% in August. The United States (US) has a light macroeconomic calendar, as it published the NFIB Business Optimism Index, which contracted to 91.2 in August from 93.7 in July. Fed officials Michael Barr and Michelle Bowman are scheduled to speak after Wall Street’s opening, although no relevant comments about monetary policy are to be expected ahead of the Federal Open Market Committee (FOMC) meeting next week.
EUR/USD short-term technical outlook
The daily chart for the EUR/USD pair shows the risk remains skewed to the downside as it develops below a now flat 20 Simple Moving Average, which provides dynamic resistance at around 1.1090. The 100 SMA is slowly advancing above the 200 SMA, both well below the current level, losing their bullish relevance. Finally, technical indicators head south with uneven strength but within negative levels, in line with another leg lower.
Technical readings in the 4-hour chart support a downward extension. The EUR/USD pair is developing below the 20 and 100 SMAs, with the shorter one gaining bearish strength. At the same time, technical indicators maintain firm downward slopes near oversold readings, supporting a break below 1.1020, the immediate support level.
Support levels: 1.1020 1.0975 1.0930
Resistance levels: 1.1090 1.1115 1.1150
EUR/USD Current price: 1.1028
- Germany confirmed the August Harmonized Index of Consumer Prices at 2% YoY.
- Speculative interest awaits the United States Consumer Price Index.
- EUR/USD pressures the 1.1020 support area, aims to break below it.
The EUR/USD pair is pressured, trading near its daily low at 1.1027. The US Dollar trades with a weaker tone against other major rivals on Tuesday, but the Euro can not attract investors. The looming European Central Bank (ECB) monetary policy announcement undermines demand for the Euro, as the ECB is widely anticipated to trim interest on the three benchmark rates by 25 basis points (bps) each. The latest data coming from the Eurozone fueled concerns about a potential recession in the area, which was led by an economic setback in Germany. An interest rate cut was priced long ago, yet recent concerns add to the Euro's weakness.
The US Dollar, in the meantime, is in no better shape. Market players are waiting for an inflation update, as the country will release the August Consumer Price Index (CPI) on Wednesday. Price pressures are expected to have eased further in the month, although the index is still foreseen above the Federal Reserve (Fed) goal of around 2%.
Data-wise, Germany confirmed that the Harmonized Index of Consumer Prices (HICP) rose at an annualized pace of 2% in August. The United States (US) has a light macroeconomic calendar, as it published the NFIB Business Optimism Index, which contracted to 91.2 in August from 93.7 in July. Fed officials Michael Barr and Michelle Bowman are scheduled to speak after Wall Street’s opening, although no relevant comments about monetary policy are to be expected ahead of the Federal Open Market Committee (FOMC) meeting next week.
EUR/USD short-term technical outlook
The daily chart for the EUR/USD pair shows the risk remains skewed to the downside as it develops below a now flat 20 Simple Moving Average, which provides dynamic resistance at around 1.1090. The 100 SMA is slowly advancing above the 200 SMA, both well below the current level, losing their bullish relevance. Finally, technical indicators head south with uneven strength but within negative levels, in line with another leg lower.
Technical readings in the 4-hour chart support a downward extension. The EUR/USD pair is developing below the 20 and 100 SMAs, with the shorter one gaining bearish strength. At the same time, technical indicators maintain firm downward slopes near oversold readings, supporting a break below 1.1020, the immediate support level.
Support levels: 1.1020 1.0975 1.0930
Resistance levels: 1.1090 1.1115 1.1150
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