EUR/USD analysis: dollar takes a deep breath, but 1.0800 holding for now
|EUR/USD Current price: 1.0804
The American dollar reversed course this Tuesday, up against its European rivals and at fresh weekly lows against commodity-related ones, as stocks bounced sharply all across the world. Wall Street got a boost from improved sentiment and better-than-expected US consumer confidence as the March Conference Board index surged to its highest since December 2000, printing 125.6 from 116.1 in February. The EUR/USD pair retreated to a daily low of 1.0798 to end the day right above the 1.0800 level. The Asian and European macroeconomic calendars were scarce while the US also published its trade balance figure for February, showing that the deficit fell to $64.8 billion in February from $68.8 billion in January, although wholesale inventories in the same month, rose by 0.4% from a previously revised -0.3%.
The greenback took a breath and seems poised to continue advancing, at least short term. Nevertheless, the turbulent political environment can see it reversing course. As for the technical outlook for the EUR/USD pair, it broke below the key 1.0820 price zone, while the 4 hours chart shows that the price is breaking below a bullish 20 SMA, which reinforces the Fibonacci resistance area, whilst technical indicators have retreated from near overbought readings, maintaining bearish slopes and entering bearish territory. Below 1.0790 the corrective movement can extend down to 1.0735, while back above 1.0830, the pair has scope to extend its gains up to 1.0930, this last the 61.8% retracement of the post-US election's decline.
Support levels: 1.0780 1.0735 1.0700
Resistance levels: 1.0830 1.0870 1.0905
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