EUR/USD Forecast: Bulls holding ground despite faltering optimism
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: 1.0499
- EU macroeconomic data beat expectations, providing temporal support to the EUR.
- The market sentiment soured after Russian President Putin talked about the rising risk of a nuclear war.
- EUR/USD lacks bullish strength in the near term but a slump is out of view.
The EUR/USD pair trades around 1.0500, after posting an intraday high of 1.0549. The pair dipped to 1.0442 during Asian trading hours, as tepid Chinese data spurred concerns about the global economic outlook. Still, upbeat European data help it turn green for the day, while a positive opening in Wall Street pushed the pair further up. The good mood did not last long, as Russian President Vladimir Putin hit the wires, noting that the threat of a nuclear war is increasing, adding that they could be used as a response to an attack. The market sentiment soured again, although falling US yields kept the Greenback in check.
European data was quite encouraging. The Euro Area Gross Domestic Product came in better than anticipated in the third quarter of the year, posting an annualized growth of 2.3%. The quarterly gain was o 0.3%, better than the 0.2% anticipated. Also, Employment Change in the same period was up by 0.3% QoQ, beating expectations. Finally, German Industrial Production was down by 0.1% MoM in October, better than anticipated, but remained unchanged on a yearly basis, missing the 2.3% advance expected.
The US, on the other hand, published MBA Mortgage Applications for the week ended December 2, which were down by 1.9%. Nonfarm Productivity rose by 0.8% in the third quarter, while Unit Labour Cost was up by 2.4% in the same period.
On Thursday, European Central Bank President Christine Lagarde is due to deliver the opening remarks at a virtual conference hosted by the European Systemic Risk Board. The US macroeconomic calendar includes weekly unemployment figures.
EUR/USD short-term technical outlook
The EUR/USD pair remains on a bullish track, although it would need to clear the immediate psychological barrier at 1.0600 to attract more buying interest. The daily chart favors an upward extension as the pair stands above all its moving averages, with the 20 SMA crossing above the 200 SMA. The 100 SMA slowly turns north, far below the current level, at around 1.0060. Finally, technical indicators turned higher, although their strength is limited at the time being.
The near-term picture shows the upside remains limited. The pair is battling to extend its gains above a flat 20 SMA, while the longer moving averages maintain modest upward slopes far below the current level. The Momentum indicator remains directionless within neutral levels, while the RSI indicator turned south, currently at around 54, all of which limited buying interest. Nevertheless, the absence of sellers is more notorious and a run towards 1.0600 is still on the table.
Support levels: 1.0480 1.0445 1.0400
Resistance levels: 1.0550 1.0585 1.0620
EUR/USD Current Price: 1.0499
- EU macroeconomic data beat expectations, providing temporal support to the EUR.
- The market sentiment soured after Russian President Putin talked about the rising risk of a nuclear war.
- EUR/USD lacks bullish strength in the near term but a slump is out of view.
The EUR/USD pair trades around 1.0500, after posting an intraday high of 1.0549. The pair dipped to 1.0442 during Asian trading hours, as tepid Chinese data spurred concerns about the global economic outlook. Still, upbeat European data help it turn green for the day, while a positive opening in Wall Street pushed the pair further up. The good mood did not last long, as Russian President Vladimir Putin hit the wires, noting that the threat of a nuclear war is increasing, adding that they could be used as a response to an attack. The market sentiment soured again, although falling US yields kept the Greenback in check.
European data was quite encouraging. The Euro Area Gross Domestic Product came in better than anticipated in the third quarter of the year, posting an annualized growth of 2.3%. The quarterly gain was o 0.3%, better than the 0.2% anticipated. Also, Employment Change in the same period was up by 0.3% QoQ, beating expectations. Finally, German Industrial Production was down by 0.1% MoM in October, better than anticipated, but remained unchanged on a yearly basis, missing the 2.3% advance expected.
The US, on the other hand, published MBA Mortgage Applications for the week ended December 2, which were down by 1.9%. Nonfarm Productivity rose by 0.8% in the third quarter, while Unit Labour Cost was up by 2.4% in the same period.
On Thursday, European Central Bank President Christine Lagarde is due to deliver the opening remarks at a virtual conference hosted by the European Systemic Risk Board. The US macroeconomic calendar includes weekly unemployment figures.
EUR/USD short-term technical outlook
The EUR/USD pair remains on a bullish track, although it would need to clear the immediate psychological barrier at 1.0600 to attract more buying interest. The daily chart favors an upward extension as the pair stands above all its moving averages, with the 20 SMA crossing above the 200 SMA. The 100 SMA slowly turns north, far below the current level, at around 1.0060. Finally, technical indicators turned higher, although their strength is limited at the time being.
The near-term picture shows the upside remains limited. The pair is battling to extend its gains above a flat 20 SMA, while the longer moving averages maintain modest upward slopes far below the current level. The Momentum indicator remains directionless within neutral levels, while the RSI indicator turned south, currently at around 54, all of which limited buying interest. Nevertheless, the absence of sellers is more notorious and a run towards 1.0600 is still on the table.
Support levels: 1.0480 1.0445 1.0400
Resistance levels: 1.0550 1.0585 1.0620
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.