EUR/USD Forecast: Euro seems vulnerable ahead of key macroeconomic events
- EUR/USD fluctuates in a narrow band at around 1.0850 early Monday.
- 1.0800 aligns as key technical support level for the pair.
- Market action could remain subdued ahead of this week's key macroeconomic events.
EUR/USD is struggling to gain traction and moving sideways near 1.0850 after closing the second consecutive week in negative territory. The pair's near-term technical outlook shows no signs of a recovery yet as market participants remain on the sidelines ahead of the Federal Reserve policy meeting and high-tier macroeconomic data releases.
Euro price today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Australian Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.01% | -0.11% | -0.08% | -0.19% | -0.20% | -0.17% | -0.13% | |
| EUR | 0.01% | -0.09% | -0.05% | -0.17% | -0.16% | -0.16% | -0.12% | |
| GBP | 0.11% | 0.10% | 0.03% | -0.11% | -0.07% | -0.07% | -0.05% | |
| CAD | 0.09% | 0.07% | -0.04% | -0.14% | -0.11% | -0.09% | -0.06% | |
| AUD | 0.19% | 0.21% | 0.11% | 0.14% | 0.03% | 0.05% | 0.06% | |
| JPY | 0.20% | 0.18% | 0.22% | 0.11% | 0.00% | 0.01% | 0.06% | |
| NZD | 0.17% | 0.18% | 0.07% | 0.09% | -0.05% | -0.02% | 0.04% | |
| CHF | 0.15% | 0.12% | 0.03% | 0.06% | -0.08% | -0.05% | -0.01% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Upbeat fourth-quarter growth data from the US helped the US Dollar (USD) stay resilient against its rivals in the second half of the previous week. Friday's data showed that the annual Core Personal Consumption Expenditures (PCE) Price Index rose 2.9% in December, down from 3.2% in November and below the market expectation of 3%. Although this data limited the USD's gains ahead of the weekend, the cautious market mood made it difficult for EUR/USD to edge higher.
There won't be any high-impact data releases on Monday. The Federal Reserve Bank of Dallas will release the Texas Manufacturing Business Index for January later in the day, which is unlikely to trigger a market reaction.
In the meantime, investors will keep a close eye on the risk perception. Geopolitical tensions could escalate further following Sunday's news of a drone strike on a US base near Syria's border with Jordan killing three and injuring more than 20 service members.
A bearish opening in Wall Street could support the USD in the second half of the day and weigh on EUR/USD.
On Tuesday, Eurostat will release fourth-quarter Gross Domestic Product (GDP) data for the Eurozone.
EUR/USD Technical Analysis
The Relative Strength Index (RSI) indicator on the 4-hour chart stays below 50 and EUR/USD closed the previous 4 4-hour candles below the 20- and 50-period Simple Moving Averages (SMA) after failing to stabilize above those levels ahead of the weekend.
On the downside, interim support seems to have formed at 1.0820 (static level) before 1.0800 (Fibonacci 50% retracement of the latest uptrend). A daily close below the latter could attract technical sellers and open the door for another leg lower toward 1.0740 (static level).
1.0870 (descending trend line, 50-period SMA, Fibonacci 38.2% retracement) aligns as stiff resistance before 1.0900 (psychological level, 100-period SMA) and 1.0940 (200-period SMA).
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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.
