EUR/USD Current price: 1.0953
- Upbeat United States macroeconomic data pushed the US Dollar higher across the FX board.
- Stock markets rally with US news as they spooked recession-related concerns.
- EUR/USD trades around 1.0950 with a strong bearish momentum, aims to extend the slide.
The EUR/USD pair held above 1.1000 throughout the first half of Thursday, and once again, it was confined to a tight intraday range. The pair peaked at 1.1046 on Wednesday, following the release of the United States (US) July Consumer Price Index (CPI). The data showed inflationary pressures ticked lower at the beginning of the third quarter despite the index holding above the Federal Reserve (Fed) goal of around 2%.
Financial markets welcomed the news, as it somehow confirmed an upcoming interest rate cut. Stocks advanced while government bond yields remained stable. The US Dollar, however, lost some modest ground, as the figures were far from changing the pre-release market’s view.
The European macroeconomic calendar had nothing relevant to offer, but the US just released a batch of relevant data. July Retail Sales increased 1%, beating the 0.3% advance anticipated by market participants. Initial Jobless Claims for the week ended August 9 were up by 227K, better than the 235K expected. Finally, regional manufacturing indexes posted negative outcomes in August but fell short of surprising.
The US Dollar surged alongside Wall Street’s futures with the news, as the figures spooked the ghost of a recession while still supporting a Fed rate cut in September.
EUR/USD short-term technical outlook
The EUR/USD pair trades near the 1.0950 level, and the daily chart shows that the bearish momentum has increased. Technical indicators retreated sharply from near overbought readings, maintaining firmly bearish downward slopes. Still, the pair keeps trading above all its moving averages, with the 20 Simple Moving Average (SMA) heading north at around 1.0890.
In the near term, and according to the 4-hour chart, the bearish case is even stronger. Technical indicators approach their midlines almost vertically, easing from extreme readings and poised to extend their slides. At the same time, the pair has fallen below its 20 SMA, which now acts as near-term resistance at around 1.0970.
Support levels: 1.0950 1.0900 1.0860
Resistance levels: 1.0970 1.1005 1.1045
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 pulls away from daily lows, stays below 1.1000
EUR/USD stages a modest rebound from the daily low it set at 1.0950 on upbeat US data releases but remains below 1.1000 in the American session. The improving risk mood limits the US Dollar's gains and helps the pair find support.
GBP/USD rebounds to 1.2850 on improving risk mood
GBP/USD regains its traction and trades marginally higher on the day near 1.2850. Although the pair came under bearish pressure after strong US data releases, it managed to reverse its direction with risk flows starting to dominate the action in financial markets.
Gold climbs above $2,450 despite rising US yields
Gold trades in positive territory above $2,450 in the American session on Thursday after dropping toward $2,430 with the immediate reaction to the stronger-than-forecast US data. The benchmark 10-year US yield is up more than 2% on the day above 3.9%, capping XAU/USD's upside.
AAVE price eyes for rally after retest of support level
Aave (AAVE) price trades slightly higher during the Asian trading session on Thursday after surging on Wednesday. On-chain data shows that open interest, daily active addresses and development activity are rising, signaling a bullish trend.
Fed rate cut in September? The data will decide
The US economy is currently navigating a period of slowing growth, persistent inflation, and a tight labour market. The Fed's aggressive monetary policy tightening over the past year has started to show results in moderating inflation