EUR/USD Forecast: at the lower end of the range
|The EUR/USD pair hovers at the lower end of last week' range, trading around 1.1150, contained during Asian trading hours by 11164, so far the daily high. Early London, German Producer Prices fell in May by 0.2% when compared to a 0.4% advance in April, up 2.8% yearly basis from previous 3.4%, and both numbers missing market's expectations. In the EU, the current account recorded a surplus of €22.2 billion in April, down from previous €35.57B. The soft readings limit the upside in the EU, despite dollar's strength receded overnight. The US calendar has little to offer today, with currencies therefore taking clues from Brexit headlines and equities.
The pair's technical outlook is neutral-to-bearish short term, as the price extended its decline below its 20 and 100 SMAs, with the shortest offering an immediate resistance around 1.1170. The Momentum indicator in the same chart remains flat around its 100 level, reflecting the absence of directional strength, whilst the RSI indicator hovers around 41. The EUR/USD pair is trading between 1.1100 and 1.1300 for a fifth consecutive week, with relevant lows below the current level at 1.1110 and 1.1075. A break below this last should favor a steeper correction, with an immediate target being the 1.1000/30 region. To the upside, beyond 1.1170, the pair has scope to advance up to 1.1220, but would take a clear break above this last to confirm additional gains towards 1.1260.
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