EUR/USD Forecast: Bulls keep pressuring
|EUR/USD Current Price: 1.1376
- The German ZEW survey unexpectedly showed dented economic sentiment in Europe.
- US core inflation held at 1.2% in June, beating the market’s expectations.
- EUR/USD hovers near daily highs, next directional move linked to equities’ direction.
The EUR/USD pair advanced to a fresh weekly high of 1.1380 this Tuesday, after meeting buyers around 1.1324 earlier in the day. The greenback gathered some strength at the beginning of the day amid the reigning dismal mood. Late Monday, news that the US state of California is back to lockdown triggered a run to safety, with Wall Street dipping in the red. The dismal sentiment is being offset by upbeat earnings reports, which boost stocks, and in turn, weigh on the greenback.
The pair is up despite a dismal German ZEW survey, which showed that Economic Sentiment in the country eased to 59.3 in July, below the previous 63.4 and the expected 60. For the EU, Economic Sentiment improved from 58.6 to 59.6 but missed the market’s expectation of 78.1. German inflation, in the meantime, held steady at 0.9% YoY in June. The US has just published its June inflation, up in the month by 0.2%. Yearly inflation met the market’s forecast with 0.6%, although core CPI resulted in 1.2%, better than the 1.1% expected.
EUR/USD short-term technical outlook
The EUR/USD pair retains its gains ahead of the US opening, bullish in the short-term, and heading towards June high at 1.1422. The 4-hour chart shows a strong upward Momentum as the RSI indicator also accelerates north, currently at 64. Moving averages in the mentioned time-frame, however, lack enough directional strength to confirm a new leg north. Nevertheless, and given the broad dollar’s weakness, further gains are to be expected.
Support levels: 1.1345 1.1310 1.1270
Resistance levels: 1.1390 1.1425 1.1460
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