EUR/USD Forecast: Mild selling pressure, downside limited

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0857

The strong momentum in metals undermined demand for the US Dollar.
The calendar will feature no macroeconomic data but multiple Fed speakers.
EUR/USD trades within familiar levels on Monday, lacks clear directional strength.

The EUR/USD pair trades around 1.0860 on a quiet Monday, hovering around its daily opening mid-European morning. Financial markets are in a good mood, with global stocks advancing, keeping the US Dollar on the back foot, particularly against commodity-linked rivals. Record highs in Gold and substantial advances in other metals also undermined demand for the Greenback, albeit an empty European macroeconomic calendar prevents the Euro from advancing.

Heading into the United States (US) opening, easing commodities gives the USD room to add some pips, although EUR/USD continues to lack volatility. The upcoming session won’t bring relevant data either, although multiple Federal Reserve (Fed) speakers will be on the wires and may introduce some noise.

EUR/USD short-term technical outlook

The daily chart for the EUR/USD pair shows a bullish overall stance. The pair trades above all its moving averages, while the 20 Simple Moving Average (SMA) maintains its upward slope, although below mildly bearish 100 and 200 SMAs. In the meantime, technical indicators hold well above their midlines, although heading in different directions, reflecting the absence of a clear directional interest.

In the near term, and according to the 4-hour chart, the risk skews to the downside. The pair has slid below a still bearish 20 SMA and aims to extend its decline. The 100 and 200 SMAs aim marginally higher over 100 pips below the current level, too far to be relevant. Finally, technical indicators aim firmly lower. The Momentum indicator has already pierced its 100 line, while the Relative Strength Index (RSI) indicator approaches its midline from above, reflecting the latest selling batch.

Support levels: 1.0830 1.0795 1.0750

Resistance levels: 1.0890 1.0920 1.0960

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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