EUR/USD Price Forecast: US government shutdown keeps the pair afloat
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 all exclusive analysis, access our analysis and get Gold and signals alerts
Elevate your trading Journey.
UPGRADEEUR/USD Current price: 1.1748
- The United States government officially shut down on Wednesday.
- The US ADP Employment Change report showed an unexpected 32,000 loss in September.
- EUR/USD lacks clear directional strength, risk skews to the upside.
Risk aversion dominates financial boards on Wednesday, keeping the US Dollar (USD) under pressure and boosting demand for safe-haven Gold. The United States (US) government effectively shut down at midnight, as Republicans and Democrats failed to clinch a deal on a funding bill. As a result, furloughs and data delays are coming in the US, fueling uncertainty.
The EUR/USD pair suffered a near-term setback after the release of macroeconomic data. On the one hand, the Eurozone released the preliminary estimate of the September Harmonized Index of Consumer Prices (HICP), which rose at an annualized pace of 2.2%, as expected. The news failed to impress market players, albeit American data did.
The US ADP Employment Change report showed that the private sector lost 32,000 jobs in September, much worse than the 50,000 jobs anticipated by market participants. At the same time, the August reading was revised to minus 3,000 vs the previous estimate of a 54,000 increase. The Greenback found near-term demand with the news, pushing EUR/USD towards intraday lows at around 1.1720, which, anyway, quickly changed course.
Coming up next is the ISM Manufacturing Purchasing Managers’ Index (PMI) forecast at 49 in September, up from the 48.7 posted in August, yet still within contraction levels.
EUR/USD short-term technical outlook
The EUR/USD pair is up for the day, albeit posting limited gains. The daily chart shows it is battling to overcome a directionless 20 Simple Moving Average (SMA) for a third consecutive day. At the same time, technical indicators remain within neutral levels, lacking clear directional strength. Finally, the 100 and 200 SMAs head north far below the current level, maintaining the long-term risk skewed to the upside.
The near-term picture shows the pair seesaws between familiar levels, without finding its way. In the 4-hour chart, EUR/USD remains trapped below a flat 100 SMA, while above an also directionless 200 SMA. The 20 SMA, in the meantime, gains modest upward traction, although not enough to suggest an upcoming advance. In the meantime, technical indicators offer downward slopes but hold above their midlines, reflecting the latest bearish peak rather than suggesting an upcoming slide. The pair set an intraday high at 1.1778, the level to beat to encourage additional buying interest.
Support levels: 1.1710 1.1685 1.1650
Resistance levels: 1.1780 1.1830 1.1880
EUR/USD Current price: 1.1748
- The United States government officially shut down on Wednesday.
- The US ADP Employment Change report showed an unexpected 32,000 loss in September.
- EUR/USD lacks clear directional strength, risk skews to the upside.
Risk aversion dominates financial boards on Wednesday, keeping the US Dollar (USD) under pressure and boosting demand for safe-haven Gold. The United States (US) government effectively shut down at midnight, as Republicans and Democrats failed to clinch a deal on a funding bill. As a result, furloughs and data delays are coming in the US, fueling uncertainty.
The EUR/USD pair suffered a near-term setback after the release of macroeconomic data. On the one hand, the Eurozone released the preliminary estimate of the September Harmonized Index of Consumer Prices (HICP), which rose at an annualized pace of 2.2%, as expected. The news failed to impress market players, albeit American data did.
The US ADP Employment Change report showed that the private sector lost 32,000 jobs in September, much worse than the 50,000 jobs anticipated by market participants. At the same time, the August reading was revised to minus 3,000 vs the previous estimate of a 54,000 increase. The Greenback found near-term demand with the news, pushing EUR/USD towards intraday lows at around 1.1720, which, anyway, quickly changed course.
Coming up next is the ISM Manufacturing Purchasing Managers’ Index (PMI) forecast at 49 in September, up from the 48.7 posted in August, yet still within contraction levels.
EUR/USD short-term technical outlook
The EUR/USD pair is up for the day, albeit posting limited gains. The daily chart shows it is battling to overcome a directionless 20 Simple Moving Average (SMA) for a third consecutive day. At the same time, technical indicators remain within neutral levels, lacking clear directional strength. Finally, the 100 and 200 SMAs head north far below the current level, maintaining the long-term risk skewed to the upside.
The near-term picture shows the pair seesaws between familiar levels, without finding its way. In the 4-hour chart, EUR/USD remains trapped below a flat 100 SMA, while above an also directionless 200 SMA. The 20 SMA, in the meantime, gains modest upward traction, although not enough to suggest an upcoming advance. In the meantime, technical indicators offer downward slopes but hold above their midlines, reflecting the latest bearish peak rather than suggesting an upcoming slide. The pair set an intraday high at 1.1778, the level to beat to encourage additional buying interest.
Support levels: 1.1710 1.1685 1.1650
Resistance levels: 1.1780 1.1830 1.1880
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.