- EUR/USD edges higher to start the week.
- Technical outlook points to a buildup of bullish momentum.
- Investors could refrain from committing to a steady advance in the pair.
EUR/USD advances beyond 1.0750 during the European trading hours, starting the week on a bullish note. The pair's technical outlook suggests that additional gains could be witnessed in the near term, but investors are likely to move to the sidelines ahead of this week's key risk events.
The risk-positive market atmosphere makes it difficult for the US Dollar (USD) to find demand early Monday, providing a boost to EUR/USD. The Euro Stoxx 50 Index is up nearly 1% and US stock index futures cling to modest daily gains in the early European session.
May inflation data from the US will be released on Tuesday. The Consumer Price Index (CPI) is forecast to rise 4.1% on a yearly basis, significantly lower than the 4.9% increase recorded in April. The Federal Reserve and the European Central Bank's (ECB) policy announcements on Wednesday and Thursday, respectively, will ramp up the volatility in financial markets in the second half of the week.
In case Wall Street's main indexes gather bullish momentum after the opening bell, the USD could stay on the back foot, and vice versa, since there won't be any high-tier macroeconomic data releases that could impact the currency's valuation.
EUR/USD Technical Analysis
The Relative Strength Index (RSI) indicator on the four-hour chart climbed above 60 and the 20-period Simple Moving Average (SMA) made a bullish cross with the 100-period SMA, highlighting the buildup of bullish momentum.
On the upside, 1.0800/1.0810 (psychological level, Fibonacci 38.2% retracement of the latest downtrend) aligns as first resistance area ahead of 1.0840 (200-period SMA) and 1.0860 (Fibonacci 50% retracement).
In case EUR/USD returns below 1.0750 (100-period SMA, Fibonacci 23.6% retracement), an extended slide toward 1.0720 (50-period SMA) and 1.0700 (psychological level, ascending trend line) could be witnessed.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.