- EUR/USD created a bullish outside day on Friday – an early warning of a bullish reversal.
- A close above Friday's high of 1.1153 is needed to confirm the trend change.
- The bullish close may remain elusive if German IFO data prints below estimates.
EUR/USD needs to close above Friday's high of 1.1153 to confirm a short-term bullish reversal. The bullish close, however, will likely remain elusive if the German Ifo data prints below estimates amid escalating trade tensions.
Bearish outside day
EUR/USD jumped 0.53% on Friday, engulfing Thursday's high and low. Essentially, the pair created a bullish outside day candle, which is widely considered an early warning of a potential bearish-to-bullish trend change.
The reversal, however, is confirmed only if there is a positive follow-through on the following day. Hence, a close above 1.1153 (outside candle's high) is needed to confirm a bullish reversal.
The bulls, however, may have a tough time, forcing a break above 1.1153 due to escalating Sino-US trade tensions. On Friday, President Trump tweeted additional tariffs on China's exports which will take effect from Sept. 1 and Oct. 1.
Focus on German IFO
The German IFO data scheduled for release at 08:00 GMT will provide insight into the latest thinking of German executives. Notably, the IFO – Business Climate (Aug) is forecasted to fall to 95.1 from July's print of 95.7.
A below-forecast August reading would only bolster the German recession fears and weaken the prospect of the EUR closing above 1.1153 today.
A bullish close could happen if the IFO numbers blow past expectations and the US Durable Goods Orders (Jul) print well below estimates, validating the dovish Federal Reserve expectations. The central bank is already facing political pressure to embark on a full-blown easing cycle.
As of writing, the pair is trading at 1.1142, having hit a high of 1.1164 in the Asian session.
-637023891763456472.png)
Technical levels
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 bounces off lows, retests 1.1370
Following an early drop to the vicinity of 1.1310, EUR/USD now manages to regain pace and retargets the 1.1370-1.1380 band on the back of a tepid knee-jerk in the US Dollar, always amid growing optimism over a potential de-escalation in the US-China trade war.
GBP/USD trades slightly on the defensive in the low-1.3300s
GBP/USD remains under a mild selling pressure just above 1.3300 on Friday, despite firmer-than-expected UK Retail Sales. The pair is weighed down by a renewed buying interest in the Greenback, bolstered by fresh headlines suggesting a softening in the rhetoric surrounding the US-China trade conflict.
Gold remains offered below $3,300
Gold reversed Thursday’s rebound and slipped toward the $3,260 area per troy ounce at the end of the week in response to further improvement in the market sentiment, which was in turn underpinned by hopes of positive developments around the US-China trade crisis.
Ethereum: Accumulation addresses grab 1.11 million ETH as bullish momentum rises
Ethereum saw a 1% decline on Friday as sellers dominated exchange activity in the past 24 hours. Despite the recent selling, increased inflows into accumulation addresses and declining net taker volume show a gradual return of bullish momentum.
Week ahead: US GDP, inflation and jobs in focus amid tariff mess – BoJ meets
Barrage of US data to shed light on US economy as tariff war heats up. GDP, PCE inflation and nonfarm payrolls reports to headline the week. Bank of Japan to hold rates but may downgrade growth outlook. Eurozone and Australian CPI also on the agenda, Canadians go to the polls.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.