EUR/USD Forecast: Bearish bias remains ahead of EU/US data, Powell's speech
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $9.99 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- EUR/USD witnessed some selling on the first day of a new week amid a modest USD strength.
- The risk-off impulse in the markets drove haven flows towards the USD and exerted pressure.
- Investors look forward to EU/US data for some impetus ahead of the Fed Chair Powell's speech.
The EUR/USD pair kicked off the new week on a downbeat note and eroded a part of Friday's positive move to one-week tops amid the emergence of some buying around the US dollar. Against the backdrop of the continuous spread of the highly contagious Delta variant of the coronavirus, disappointing Chinese macro data and political tension in Afghanistan weighed on investors' sentiment. This was evident from the risk-off impulse in the markets, which provided a modest lift to the safe-haven greenback.
On the economic data front, the US Empire State Manufacturing Index dropped sharply from 43.0 to 18.3 in August, worse than market expectations for a reading of 29.0. This comes on the back of a slump in the US consumer sentiment on Friday, which forced investors to further scale back their expectations for an early policy tightening by the Fed. This was reinforced by the ongoing decline in the US Treasury bond yields, though did little to hinder a modest USD intraday uptick.
Nevertheless, the pair settled near the lower end of its daily trading range and remained depressed through the Asian session on Tuesday. This marked the second successive day of a negative move as market participants look forward to the preliminary estimate of the Eurozone Q2 GDP growth figures. From the US, the monthly Retail Sales figures might also provide some trading impetus to the pair. The key focus, however, will be on Fed Chair Jerome Powell's scheduled speech.
Apart from this, Wednesday's release of the FOMC monetary policy meeting minutes will play a key role in influencing market expectations for the next policy move by the US central bank. This, in turn, will drive the greenback in the near term and help investors to determine the next leg of a directional move for the major.
Short-term technical outlook
EUR/USD witnessed some selling on the first day of a new week amid a modest USD strength.
The risk-off impulse in the markets drove haven flows towards the USD and exerted pressure.
The USD seemed unaffected by sliding US yields amid uncertainty over the Fed’s taper plans.
The EUR/USD pair kicked off the new week on a downbeat note and eroded a part of Friday's positive move to one-week tops amid the emergence of some buying around the US dollar. Against the backdrop of the continuous spread of the highly contagious Delta variant of the coronavirus, disappointing Chinese macro data and political tension in Afghanistan weighed on investors' sentiment. This was evident from the risk-off impulse in the markets, which provided a modest lift to the safe-haven greenback.
On the economic data front, the US Empire State Manufacturing Index dropped sharply from 43.0 to 18.3 in August, worse than market expectations for a reading of 29.0. This comes on the back of a slump in the US consumer sentiment on Friday, which forced investors to further scale back their expectations for an early policy tightening by the Fed. This was reinforced by the ongoing decline in the US Treasury bond yields, though did little to hinder a modest USD intraday uptick.
Nevertheless, the pair settled near the lower end of its daily trading range and remained depressed through the Asian session on Tuesday. This marked the second successive day of a negative move as market participants look forward to the preliminary estimate of the Eurozone Q2 GDP growth figures. From the US, the monthly Retail Sales figures might also provide some trading impetus to the pair. The key focus, however, will be on Fed Chair Jerome Powell's scheduled speech.
Apart from this, Wednesday's release of the FOMC monetary policy meeting minutes will play a key role in influencing market expectations for the next policy move by the US central bank. This, in turn, will drive the greenback in the near term and help investors to determine the next leg of a directional move for the major.
Short-term technical outlook
From a technical perspective, the recent bounce from the vicinity of YTD lows stalled near a short-term ascending trend-line breakpoint. The mentioned support-turned-resistance, around the 1.1800 mark, should now act as a key pivotal point for short-term traders. A sustained move beyond might trigger a short-covering move and lift the pair further beyond the 1.1830-35 region. The next relevant hurdle is pegged near the 1.1880 supply zone before the pair eventually aims to reclaim the 1.1900 mark.
On the flip side, the 1.1740-20 region might act as immediate support ahead of the 1.1700 mark. A convincing break below will reaffirm the bearish outlook and prompt some aggressive technical selling. The pair might then accelerate the fall towards intermediate support near the 1.1665-60 region en-route November 2020 lows, around the 1.1600 round figure. The mentioned support-turned-resistance, around the 1.1800 mark, should now act as a key pivotal point for short-term traders. A sustained move beyond might trigger a short-covering move and lift the pair further beyond the 1.1830-35 region. The next relevant hurdle is pegged near the 1.1880 supply zone before the pair eventually aims to reclaim the 1.1900 mark.
On the flip side, the 1.1740-20 region might act as immediate support ahead of the 1.1700 mark. A convincing break below will reaffirm the bearish outlook and prompt some aggressive technical selling. The pair might then accelerate the fall towards intermediate support near the 1.1665-60 region en-route November 2020 lows, around the 1.1600 round figure.
- EUR/USD witnessed some selling on the first day of a new week amid a modest USD strength.
- The risk-off impulse in the markets drove haven flows towards the USD and exerted pressure.
- Investors look forward to EU/US data for some impetus ahead of the Fed Chair Powell's speech.
The EUR/USD pair kicked off the new week on a downbeat note and eroded a part of Friday's positive move to one-week tops amid the emergence of some buying around the US dollar. Against the backdrop of the continuous spread of the highly contagious Delta variant of the coronavirus, disappointing Chinese macro data and political tension in Afghanistan weighed on investors' sentiment. This was evident from the risk-off impulse in the markets, which provided a modest lift to the safe-haven greenback.
On the economic data front, the US Empire State Manufacturing Index dropped sharply from 43.0 to 18.3 in August, worse than market expectations for a reading of 29.0. This comes on the back of a slump in the US consumer sentiment on Friday, which forced investors to further scale back their expectations for an early policy tightening by the Fed. This was reinforced by the ongoing decline in the US Treasury bond yields, though did little to hinder a modest USD intraday uptick.
Nevertheless, the pair settled near the lower end of its daily trading range and remained depressed through the Asian session on Tuesday. This marked the second successive day of a negative move as market participants look forward to the preliminary estimate of the Eurozone Q2 GDP growth figures. From the US, the monthly Retail Sales figures might also provide some trading impetus to the pair. The key focus, however, will be on Fed Chair Jerome Powell's scheduled speech.
Apart from this, Wednesday's release of the FOMC monetary policy meeting minutes will play a key role in influencing market expectations for the next policy move by the US central bank. This, in turn, will drive the greenback in the near term and help investors to determine the next leg of a directional move for the major.
Short-term technical outlook
EUR/USD witnessed some selling on the first day of a new week amid a modest USD strength.
The risk-off impulse in the markets drove haven flows towards the USD and exerted pressure.
The USD seemed unaffected by sliding US yields amid uncertainty over the Fed’s taper plans.
The EUR/USD pair kicked off the new week on a downbeat note and eroded a part of Friday's positive move to one-week tops amid the emergence of some buying around the US dollar. Against the backdrop of the continuous spread of the highly contagious Delta variant of the coronavirus, disappointing Chinese macro data and political tension in Afghanistan weighed on investors' sentiment. This was evident from the risk-off impulse in the markets, which provided a modest lift to the safe-haven greenback.
On the economic data front, the US Empire State Manufacturing Index dropped sharply from 43.0 to 18.3 in August, worse than market expectations for a reading of 29.0. This comes on the back of a slump in the US consumer sentiment on Friday, which forced investors to further scale back their expectations for an early policy tightening by the Fed. This was reinforced by the ongoing decline in the US Treasury bond yields, though did little to hinder a modest USD intraday uptick.
Nevertheless, the pair settled near the lower end of its daily trading range and remained depressed through the Asian session on Tuesday. This marked the second successive day of a negative move as market participants look forward to the preliminary estimate of the Eurozone Q2 GDP growth figures. From the US, the monthly Retail Sales figures might also provide some trading impetus to the pair. The key focus, however, will be on Fed Chair Jerome Powell's scheduled speech.
Apart from this, Wednesday's release of the FOMC monetary policy meeting minutes will play a key role in influencing market expectations for the next policy move by the US central bank. This, in turn, will drive the greenback in the near term and help investors to determine the next leg of a directional move for the major.
Short-term technical outlook
From a technical perspective, the recent bounce from the vicinity of YTD lows stalled near a short-term ascending trend-line breakpoint. The mentioned support-turned-resistance, around the 1.1800 mark, should now act as a key pivotal point for short-term traders. A sustained move beyond might trigger a short-covering move and lift the pair further beyond the 1.1830-35 region. The next relevant hurdle is pegged near the 1.1880 supply zone before the pair eventually aims to reclaim the 1.1900 mark.
On the flip side, the 1.1740-20 region might act as immediate support ahead of the 1.1700 mark. A convincing break below will reaffirm the bearish outlook and prompt some aggressive technical selling. The pair might then accelerate the fall towards intermediate support near the 1.1665-60 region en-route November 2020 lows, around the 1.1600 round figure. The mentioned support-turned-resistance, around the 1.1800 mark, should now act as a key pivotal point for short-term traders. A sustained move beyond might trigger a short-covering move and lift the pair further beyond the 1.1830-35 region. The next relevant hurdle is pegged near the 1.1880 supply zone before the pair eventually aims to reclaim the 1.1900 mark.
On the flip side, the 1.1740-20 region might act as immediate support ahead of the 1.1700 mark. A convincing break below will reaffirm the bearish outlook and prompt some aggressive technical selling. The pair might then accelerate the fall towards intermediate support near the 1.1665-60 region en-route November 2020 lows, around the 1.1600 round figure.
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.