EUR/USD Forecast: Euro could face stiff resistance at 1.0800

EUR/USD stabilized above 1.0750 after posting gains for two consecutive days.
Strong resistance seems to have formed at 1.0800.
Producer inflation and consumer sentiment data will be featured in the US economic docket.

Eren Sengezer FXStreet

EUR/USD stays in a consolidation phase above 1.0750 on Friday after closing the previous two days in positive territory. Although the pair's near-term technical outlook points to a buildup of bullish momentum, buyers could remain on the sidelines unless 1.0800 is flipped into support.

Mixed macroeconomic data releases from the US and the positive shift seen in risk mood made it difficult for the US Dollar (USD) to hold its ground on Thursday and allowed EUR/USD to extend its recovery. Retail Sales in the US declined 0.8% on a monthly basis in January, while the weekly Initial Jobless Claims declined to 212,000 from 220,000.

Later in the day, the US Bureau of Labor Statistics will release the Producer Price Index (PPI) data for January. The PPI is forecast to rise 0.1% on a monthly basis following December's 0.1% decline. A negative monthly PPI print could weigh on the USD with the immediate reaction. On the other hand, an unexpected increase of 0.3% or bigger could provide a boost to the currency and force EUR/USD to stay on the back foot.

According to the CME FedWatch Tool, markets are currently pricing in a near 70% probability of the Federal Reserve (Fed) leaving the policy rate unchanged at the next two policy meetings. The market positioning suggests that the USD could weaken sharply in case investors start leaning toward a policy pivot in May.

EUR/USD Technical Analysis

The Relative Strength Index (RSI) indicator on the 4-hour chart rose above 50 and EUR/USD closed the last 5 4-hour candles above the 20-period and 50-period Simple Moving Averages (SMA), highlighting a bullish tilt in the short-term technical outlook.

1.0800 (Fibonacci 23.6% retracement of the latest downtrend, 100-day SMA, upper limit of the descending regression trend channel) aligns as critical resistance for EUR/USD. In case the pair rises above that level and confirms it as support, it could target 1.0830 (50-day SMA) and 1.0860 (200-period SMA) next.

On the downside, immediate support is located at 1.0760 (50-period SMA) before 1.0730-40 (20-period SMA, mid-point of the descending channel) and 1.0700 (end-point of the downtrend, psychological level).

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.