EUR/USD Price Forecast: Stable above 1.1400, bulls may soon return
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UPGRADEEUR/USD Current price: 1.1408
- Easing political and fiscal US tensions underpin the market’s mood.
- EU tepid business activity limits demand for the Euro on Wednesday.
- EUR/USD consolidates around 1.1400, needs to recover above 1.1450.
The EUR/USD pair bottomed at 1.1308 early in the Asian session, as the US Dollar (USD) gathered momentum late on Tuesday, following headlines suggesting easing trade tensions between the United States (US) and China alongside comments from US President Donald Trump referring to Federal Reserve’s (Fed) Chairman Jerome Powell’s status.
Firstly, US Treasury Secretary Scott Bessent said that the current situation with China is unsustainable and that he sees a de-escalation of the situation. Later in the day, President Trump said he had no intention of firing Powell, despite calling him a “loser” and being frustrated with high interest rates. Regarding China, Trump added that negotiations are going well and that he thinks they will reach a deal.
Wall Street rallied with relief, leading to gains in Asian and European indexes. US futures aim higher, trimming all of their Monday losses. The better mood limits USD gains early in the American session.
Meanwhile, tepid European data prevents the Euro (EUR) from recovering further. The Hamburg Commercial Bank (HCOB) released the preliminary estimates of the Eurozone (EU) Purchasing Managers’ Indexes (PMIs), which showed business activity in the region remained subdued in April. The Services PMI came in at 49.7, easing from the previous 51.5 and a five-month low. The manufacturing index posted a modest improvement, from the previous 48.6 to 48.7, while the Composite PMI resulted at 50.1, down from the 50.9 posted in March.
The upcoming US session will bring a slew of Fed speakers and the preliminary US S&P Global PMIs. The country will also publish the March New Home Sales
EUR/USD short-term technical outlook
The EUR/USD trades around the 1.1400 mark, posting modest losses on a daily basis. From a technical perspective, the pair may maintain the soft tone, yet a steeper slide seems out of the picture. In the daily chart, the pair keeps developing far above all its moving averages, with a firmly bullish 20 Simple Moving Average (SMA) currently at around 1.1128. At the same time, the Momentum indicator heads firmly south, although well above its midline, while the Relative Strength Index (RSI) indicator stabilised at around 66, the latter reflecting easing selling interest.
In the near term, and according to the 4-hour chart, the EUR/USD pair seems to be comfortably consolidating. It trades below a now flat 20 SMA, providing dynamic resistance at around 1.1450. Still, the 100 and 200 SMAs maintain their bullish slopes far below the current level. Finally, the Momentum indicator aims lower below its 100 level, yet the RSI indicator turned flat within neutral levels. Gains beyond the 1.1450 level should put buyers back on track.
Support levels: 1.1370 1.1325 1.1285
Resistance levels: 1.1450 1.1490 1.1545
EUR/USD Current price: 1.1408
- Easing political and fiscal US tensions underpin the market’s mood.
- EU tepid business activity limits demand for the Euro on Wednesday.
- EUR/USD consolidates around 1.1400, needs to recover above 1.1450.
The EUR/USD pair bottomed at 1.1308 early in the Asian session, as the US Dollar (USD) gathered momentum late on Tuesday, following headlines suggesting easing trade tensions between the United States (US) and China alongside comments from US President Donald Trump referring to Federal Reserve’s (Fed) Chairman Jerome Powell’s status.
Firstly, US Treasury Secretary Scott Bessent said that the current situation with China is unsustainable and that he sees a de-escalation of the situation. Later in the day, President Trump said he had no intention of firing Powell, despite calling him a “loser” and being frustrated with high interest rates. Regarding China, Trump added that negotiations are going well and that he thinks they will reach a deal.
Wall Street rallied with relief, leading to gains in Asian and European indexes. US futures aim higher, trimming all of their Monday losses. The better mood limits USD gains early in the American session.
Meanwhile, tepid European data prevents the Euro (EUR) from recovering further. The Hamburg Commercial Bank (HCOB) released the preliminary estimates of the Eurozone (EU) Purchasing Managers’ Indexes (PMIs), which showed business activity in the region remained subdued in April. The Services PMI came in at 49.7, easing from the previous 51.5 and a five-month low. The manufacturing index posted a modest improvement, from the previous 48.6 to 48.7, while the Composite PMI resulted at 50.1, down from the 50.9 posted in March.
The upcoming US session will bring a slew of Fed speakers and the preliminary US S&P Global PMIs. The country will also publish the March New Home Sales
EUR/USD short-term technical outlook
The EUR/USD trades around the 1.1400 mark, posting modest losses on a daily basis. From a technical perspective, the pair may maintain the soft tone, yet a steeper slide seems out of the picture. In the daily chart, the pair keeps developing far above all its moving averages, with a firmly bullish 20 Simple Moving Average (SMA) currently at around 1.1128. At the same time, the Momentum indicator heads firmly south, although well above its midline, while the Relative Strength Index (RSI) indicator stabilised at around 66, the latter reflecting easing selling interest.
In the near term, and according to the 4-hour chart, the EUR/USD pair seems to be comfortably consolidating. It trades below a now flat 20 SMA, providing dynamic resistance at around 1.1450. Still, the 100 and 200 SMAs maintain their bullish slopes far below the current level. Finally, the Momentum indicator aims lower below its 100 level, yet the RSI indicator turned flat within neutral levels. Gains beyond the 1.1450 level should put buyers back on track.
Support levels: 1.1370 1.1325 1.1285
Resistance levels: 1.1450 1.1490 1.1545
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