EUR/USD analysis: bulls hesitate around 1.1300
|EUR/USD Current Price: 1.1280
- The EUR/USD pair lost the 1.1300 mark on news Consumer Confidence plunged in June.
- US data was mostly discouraging, preventing the dollar from recovering post-Fed's losses.
The EUR/USD pair has peaked at 1.1316 this Thursday, driven by dollar's negative momentum post-Fed's monetary policy announcement. The American currency sell-off had persisted throughout the day, as US data failed to impress. However, in the case of EUR/USD, the pair eased from the mentioned high to settle around the current 1.1280 price zone, as, according to preliminary estimates, EU Consumer Confidence fell to -7.2 vs. the expected -6.5 in June, as a result of increased pessimism related to economic growth. In the US, the Q1 Current Account, printed a larger-than-expected deficit of $130.4B, while the Philadelphia Fed Manufacturing Survey came in at 0.3 for June, well below the 11.0 expected. Unemployment claims for the week ended June 14, on the other hand, came in better-than-expected, down to 216K.
The week is set to end on a high note, as the macroeconomic calendar will be quite busy. Markit will release the preliminary estimates of its PMI for June for the EU and the US. Manufacturing activity is expected to have remained depressed, while the services sector output is seen a bit firmer in both economies. The US will also publish May Existing Home Sales data, while a couple of Fed officials are scheduled to speak in different events.
From a technical point of view, the EUR/USD pair is closing with solid gains for a second consecutive day, although the fact that it has been unable to sustain gains above the 1.1300 figure suggests that bulls are not yet fully convinced. The 4 hours chart shows that the price remains above all of its moving averages, with the 20 SMA gaining bullish strength well below the current level. The Momentum indicator is easing just modestly from overbought territory, while the RSI has pulled back from extreme levels, now stable at around 64. The risk of a downward extension will be more substantial if the pair falls below 1.1260, now the immediate support, while bulls will likely recover control on an advance beyond 1.1315.
Support levels: 1.1260 1.1225 1.1180
Resistance levels: 1.1315 1.1350 1.1390
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