EUR/USD Current Price: 1.0755
- The ECB downwardly revises growth figures but pushes up inflation ones.
- European policymakers hinted at a 25 bps rate hike in July and another in September.
- EUR/USD has turned bullish in the near term but remains below a critical resistance level.
The EUR/USD pair trades with modest gains in the 1.0760 price zone, volatile in the middle of the European Central Bank monetary policy decision. The central bank has maintained rates on hold, as expected while anticipating a 25 bps hike in July. The pair fell to 1.0687 but quickly recovered from the level, despite policymakers upwardly reviewing inflation figures.
Annual inflation is now seen at 6.8% for this year, then decreasing to 3.5% in 2023 and to 2.1% in 2024. Growth has been downwardly revised to 2.8% in 2022 and to 2.1% for the next two years. Additionally, another rate hike is planned for September, and the scale of the increment would depend on the medium-term inflation outlook.
ECB President Christine Lagarde is giving a speech, which could spur more volatility around the pair, particularly within the Q&A. In the meantime, the US published Initial Jobless Claims for the week ended June 3, which were up to 229K, worse than anticipated.
EUR/USD short-term technical outlook
The EUR/USD pair trades around the 50% retracement of its latest daily slump, at 1.0770, also near the May high at 1.0780. According to the daily chart, the risk is now skewed to the upside. Technical indicators have turned higher within positive levels, reflecting increased buying interest. At the same time, the 20 SMA maintains its bullish slope below the current level, approaching the 38.2% retracement of the aforementioned decline at 1.0665.
The 4-hour chart shows that the bullish momentum picked up, as technical indicators head firmly north within positive levels and at their highest for this week. The 100 SMA keeps advancing below the current level while the pair rallies above a flat 20 SMA. The pair has room to extend its gains once above the 1.0780 region, aiming then for the next Fibonacci resistance at 1.0860.
Support levels: 1.0710 1.0665 1.0620
Resistance levels: 1.0780 1.0815 1.0860
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
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD refocuses its attention to 1.1200 and above
Rising appetite for the risk-associated assets, the offered stance in the Greenback and Chinese stimulus all contributed to the resurgence of the upside momentum in EUR/USD, which managed to retest the 1.1190 zone on Thursday.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Bitcoin displays bullish signals amid supportive macroeconomic developments and growing institutional demand
Bitcoin (BTC) trades slightly up, around $64,000 on Thursday, following a rejection from the upper consolidation level of $64,700 the previous day. BTC’s price has been consolidating between $62,000 and $64,700 for the past week.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.