EUR/USD Forecast: Bulls cheer the ECB waking up to reality
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 OFFEREUR/USD Current Price: 1.0542
- ECB Governing Council member Klaas Knot put a 50 bps rate hike on the table.
- US Retail Sales beat expectations in April, up by 0.9% MoM.
- EUR/USD is in recovery mode and nearing a critical dynamic resistance level.
The EUR/USD pair advanced to an intraday high of 1.0555 during the European morning, boosted by comments from European Central Bank Governing Council member Klaas Knot. Speaking on Dutch TV, Knot said that a 50 bps rate hike should not be excluded if data suggest inflation keeps broadening and accumulating. He also added that a 25 bps hike in July would be realistic.
The shared currency was also aided by the positive tone of global stocks, which pointed to a better market mood, despite the underlying issues. Finally, the EU Q1 Gross Domestic Product was upwardly revised to 0.3% QoQ, while the annual comparison was lifted to 5.1% from 5% in the previous estimate.
The pair held on to gains above the 1.0500 ahead of the release of US Retail Sales. According to the official report, sales were up 0.9% in April, better than anticipated. The core reading also beat the market’s forecast, as Retail Sales Control Group were up by 1%. The US will later release April Industrial Production and Capacity Utilization.
EUR/USD short-term technical outlook
The daily chart for EUR/USD shows that the bullish momentum is building up, although further gains are yet to be confirmed. Technical indicators continue to advance within negative levels, with the Momentum about to cross its midline into positive levels. At the same time, the pair is developing below bearish moving averages, with the 20 SMA currently providing dynamic resistance around 1.0575.
According to the 4-hour chart, the pair is bullish. It has extended its rally above a now flat 20 SMA while is currently battling to surpass a bearish 100 SMA. Technical indicators, in the meantime, head firmly higher near overbought readings. Further gains could be expected if the pair extends its advance beyond the aforementioned resistance in the 1.0570 region, while the case for bears will return if EUR/USD slides below 1.0470.
Support levels: 1.0510 1.0470 1.0430
Resistance levels: 1.0575 1.0620 1.0660
EUR/USD Current Price: 1.0542
- ECB Governing Council member Klaas Knot put a 50 bps rate hike on the table.
- US Retail Sales beat expectations in April, up by 0.9% MoM.
- EUR/USD is in recovery mode and nearing a critical dynamic resistance level.
The EUR/USD pair advanced to an intraday high of 1.0555 during the European morning, boosted by comments from European Central Bank Governing Council member Klaas Knot. Speaking on Dutch TV, Knot said that a 50 bps rate hike should not be excluded if data suggest inflation keeps broadening and accumulating. He also added that a 25 bps hike in July would be realistic.
The shared currency was also aided by the positive tone of global stocks, which pointed to a better market mood, despite the underlying issues. Finally, the EU Q1 Gross Domestic Product was upwardly revised to 0.3% QoQ, while the annual comparison was lifted to 5.1% from 5% in the previous estimate.
The pair held on to gains above the 1.0500 ahead of the release of US Retail Sales. According to the official report, sales were up 0.9% in April, better than anticipated. The core reading also beat the market’s forecast, as Retail Sales Control Group were up by 1%. The US will later release April Industrial Production and Capacity Utilization.
EUR/USD short-term technical outlook
The daily chart for EUR/USD shows that the bullish momentum is building up, although further gains are yet to be confirmed. Technical indicators continue to advance within negative levels, with the Momentum about to cross its midline into positive levels. At the same time, the pair is developing below bearish moving averages, with the 20 SMA currently providing dynamic resistance around 1.0575.
According to the 4-hour chart, the pair is bullish. It has extended its rally above a now flat 20 SMA while is currently battling to surpass a bearish 100 SMA. Technical indicators, in the meantime, head firmly higher near overbought readings. Further gains could be expected if the pair extends its advance beyond the aforementioned resistance in the 1.0570 region, while the case for bears will return if EUR/USD slides below 1.0470.
Support levels: 1.0510 1.0470 1.0430
Resistance levels: 1.0575 1.0620 1.0660
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.