- DXY rebound falters in Asia.
- German politics, ECB jawboning to keep upside limited.
- Eyes US macro news for fresh incentives.
The EUR/USD pair staged a solid comeback in Asia, having reversed from four-day lows of 1.2165. However, sellers continued to lurk just ahead of the 1.22 handle, leaving the rates in a consolidative phase below the last.
The spot is seen trying hard to retain the bids over the last hours, as upbeat US data-led rebound in the US dollar from multi-year lows versus its main peers loses steam. Expectations of higher global interest rates, as most major central banks are likely to join the Fed in normalizing their monetary policy this, continues to dampen the sentiment around the greenback
On Wednesday, the main currency pair corrected sharply from its best levels since Dec 2014 at 1.2323, after markets used the excuse of the ECB officials’ jawboning the currency to book profits on their EUR longs, as attention now turns towards the ECB monetary policy decision due next week.
ECB’s Nowotny: Euro exchange rate must be observed
ECB’s Constancio: Worried about Euro moves that don't reflect fundamentals
Meanwhile, the major showed limited reaction to the Eurozone final CPI numbers, which confirmed the flash estimate of 1.4% on an annualized basis. In the day ahead, markets eagerly await a fresh batch of macro news from the US docket for fresh impetus, as the EUR calendar remains data-dry. However, the speech by the German Bundesbank President Weidmann will be eyed in the European session.
EUR/USD Technical Levels
FXStreet’s Chief Analyst, Valeria Bednarik, writes: “The 4 hours chart present some minor divergences, as the price is recovering after struggling around a bullish 20 SMA, but the Momentum indicator keeps heading lower around its 100 level, mostly due to the price being below its previous highs. Any possible upcoming decline should be considered corrective after the pair added roughly 400 pips pretty much straight, yet renewed buying interest above 1.2280 is now required to revert the short-term negative tone and consider higher highs ahead. Support levels: 1.2190 1.2155 1.2110. Resistance levels: 1.2280 1.2320 1.2350.”
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 stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.