- EUR/USD bulls run out of steam inside seven-week-old horizontal resistance region.
- Overbought RSI, market’s consolidation after ECB, Fed moves challenge Euro pair’s further upside.
- 78.6% Fibonacci retracement acts as additional challenge for buyers; Euro bears remain off the table beyond 1.0820 support confluence.
- Final prints of Eurozone inflation, US Michigan Consumer Sentiment Index awaited for clear directions.
EUR/USD treads water around mid-1.0900s during a sluggish early Friday morning in Europe. In doing so, the Euro pair struggles to extend the previous day’s run-up, the biggest since early February, while making rounds to a five-week high.
That said, the pair rallied the previous day as the European Central Bank (ECB) marked a hawkish play to beat Wednesday’s Federal Reserve (Fed) announcements. The latest inaction, however, appears to lack clear catalysts amid a light calendar and cautious mood ahead of the final readings of Eurozone inflation data for May, as per the Harmonized Index of Consumer Prices (HICP) details. Additionally important will be the preliminary readings of the Michigan Consumer Sentiment Index (CSI) for June and five-year inflation expectations.
Also read: EUR/USD grinds at five-week top around 1.0950 as Euro bulls seek more clues of ECB vs. Fed play
Technically, a horizontal resistance zone comprising multiple levels marked since April 24, between 1.0965 and 1.0940, restricts immediate EUR/USD moves amid the overbought RSI.
Even if the quote manages to cross the 1.0965 hurdle, the 78.6% Fibonacci retracement level of its previous monthly fall, around the 1.1000 psychological magnet, can challenge the EUR/USD bulls ahead of directing them to the yearly high of near 1.1100 marked in April.
On the contrary, a downside break of the 1.0940 immediate support can drag the EUR/USD price to the 61.8% Fibonacci retracement surrounding the 1.0920 level. Following that, the 50% Fibonacci retracement level near 1.0865 may lure the Euro bears.
It should be noted, however, that the EUR/USD buyers should remain hopeful unless witnessing a clear downside break of the 1.0825-20 support confluence including the 200-SMA and an ascending trend line from June 07.
EUR/USD: Four-hour chart
Trend: Pullback expected
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 retreats to three-week lows near 1.1050 on Middle East jitters
EUR/USD accelerates its downtrend on Tuesday on the back of further gains in the US Dollar, which were exacerbated following Iran's missile attack on Israel.
GBP/USD drops to multi-day lows near 1.3250
Further selling pressure motivates GBP/USD to break below the 1.3300 support with certain conviction on the back of the robust uptick in the Greenback, which gathered extra steam ono escalating effervescence in the Middle East.
Gold looks firm around $2,670 on Israel-Iran crisis
Gold prices maintain their bullish bias around the $2,670 region per ounce troy on the back of increasing tension in the Middle East after Iran launched a missile attack on Israel.
Gillian Lynch, head of EU at Gemini: “The next phase of crypto growth will be exponential”
Gillian Lynch is the Head of Ireland and EU at Gemini, the US crypto exchange founded by Cameron and Tyler Winklevoss. FXStreet interviewed her during the European Blockchain Convention 2024 in Barcelona, where Lynch expressed her optimism about the crypto industry.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.