EUR/USD Forecast: Bulls piling up fresh longs
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UNLOCK OFFEREUR/USD Current Price: 1.0510
- United States will publish the November Nonfarm Payrolls report on Friday.
- Euro Area S&P Global Manufacturing PMIs suffered downward revisions.
- EUR/USD turned bullish after finally breaking above the 200 DMA.
The EUR/USD pair surged to 1.0533, its highest since June 2022, on the back of persistent US Dollar weakness. The American currency came under selling pressure late on Wednesday when US Federal Reserve (Fed) Chair Jerome Powell discussed a slower pace of quantitative tightening that could start as soon as this month.
The Greenback resumed its decline early in the American session, as US data supported Fed’s stance amid increased risks of an economic downturn. The Personal Consumption Expenditures (PCE) Price Index rose by 6% YoY in October, easing from 6.3%. Core PCE inflation came in at 5% in the same period, down from 5.2% in September. Also, the ISM Manufacturing PMI fell to 49 in November, down from the previous 50.2, being the first time the indicator signals contraction since May 2020.
European data was far from encouraging. German Retail Sales fell by 2.8% MoM in October, much worse than anticipated. Additionally, S&P Global released the final versions of its November Manufacturing PMIs, which were downwardly revised. The German index was confirmed at 46.2, while the Euro Area one came down to 47.1 from the previously estimated 47.3.
On Friday, the United States will publish the November Nonfarm Payrolls report (NFP). The country is expected to have added 200K new jobs in the month, down from 261K in October. The Unemployment Rate is foreseen at 3.7%, unchanged from the previous month. Ahead of the event, the Euro Area will publish the October Producer Price Index (PPI), which is expected to have contracted by 2% MoM.
EUR/USD short-term technical outlook
The EUR/USD pair’s daily chart shows that it has extended its gains beyond a mildly bearish 200 Simple Moving Average (SMA) while the 20 SMA heads firmly north below it. The fact that EUR/USD broke above the mentioned 200 SMA and took over 1.0500 may encourage bulls to keep piling up long positions. At the same time, the Momentum indicator keeps heading lower within positive levels, although losing its downward strength. Finally, the Relative Strength Indicator (RSI) turned higher and currently stands at 67, all of which hints at a bullish continuation.
In the near term, and according to the 4-hour chart, chances are of another leg higher. Technical indicators maintain their upward slopes within positive levels while the pair develops above all of its moving averages. The 20 SMA is flat at around 1.0380, but the longer ones keep heading higher below it, supporting a bullish continuation.
Support levels: 1.0465 1.0420 1.0375
Resistance levels: 1.0540 1.0585 1.0630
EUR/USD Current Price: 1.0510
- United States will publish the November Nonfarm Payrolls report on Friday.
- Euro Area S&P Global Manufacturing PMIs suffered downward revisions.
- EUR/USD turned bullish after finally breaking above the 200 DMA.
The EUR/USD pair surged to 1.0533, its highest since June 2022, on the back of persistent US Dollar weakness. The American currency came under selling pressure late on Wednesday when US Federal Reserve (Fed) Chair Jerome Powell discussed a slower pace of quantitative tightening that could start as soon as this month.
The Greenback resumed its decline early in the American session, as US data supported Fed’s stance amid increased risks of an economic downturn. The Personal Consumption Expenditures (PCE) Price Index rose by 6% YoY in October, easing from 6.3%. Core PCE inflation came in at 5% in the same period, down from 5.2% in September. Also, the ISM Manufacturing PMI fell to 49 in November, down from the previous 50.2, being the first time the indicator signals contraction since May 2020.
European data was far from encouraging. German Retail Sales fell by 2.8% MoM in October, much worse than anticipated. Additionally, S&P Global released the final versions of its November Manufacturing PMIs, which were downwardly revised. The German index was confirmed at 46.2, while the Euro Area one came down to 47.1 from the previously estimated 47.3.
On Friday, the United States will publish the November Nonfarm Payrolls report (NFP). The country is expected to have added 200K new jobs in the month, down from 261K in October. The Unemployment Rate is foreseen at 3.7%, unchanged from the previous month. Ahead of the event, the Euro Area will publish the October Producer Price Index (PPI), which is expected to have contracted by 2% MoM.
EUR/USD short-term technical outlook
The EUR/USD pair’s daily chart shows that it has extended its gains beyond a mildly bearish 200 Simple Moving Average (SMA) while the 20 SMA heads firmly north below it. The fact that EUR/USD broke above the mentioned 200 SMA and took over 1.0500 may encourage bulls to keep piling up long positions. At the same time, the Momentum indicator keeps heading lower within positive levels, although losing its downward strength. Finally, the Relative Strength Indicator (RSI) turned higher and currently stands at 67, all of which hints at a bullish continuation.
In the near term, and according to the 4-hour chart, chances are of another leg higher. Technical indicators maintain their upward slopes within positive levels while the pair develops above all of its moving averages. The 20 SMA is flat at around 1.0380, but the longer ones keep heading higher below it, supporting a bullish continuation.
Support levels: 1.0465 1.0420 1.0375
Resistance levels: 1.0540 1.0585 1.0630
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