EUR/USD analysis: bouncing from daily low, bearish anyway

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1560

Soft US manufacturing data and hawkish surprise from the BOE helped EUR bounce.
Risk aversion keeping equities near weekly lows, further slides may weigh on the common currency.

The EUR/USD pair fell to a fresh yearly low of 1.1507, barely 2 pips below the previous one before bouncing some, getting some help from BOE's monetary policy announcement that paused high-yielding assets' slump. Nevertheless, the common currency holds near its daily low with the greenback benefiting from a risk-averse environment, spurred by increasing trade-war tension escalating globally, as several economies are announcing retaliation measures against Trump's tariffs on aluminum and steel imports. There were no relevant news coming from the EU, while the US released its weekly unemployment claims, which resulted at 218K for the week ended June 15, beating expectations of 220K and below the previous upwardly revised 221K. On a disappointing note, the Philadelphia Fed Manufacturing Survey came in at 19.9 for June, well below the previous 34.4 or the expected 29.0.

The EUR/USD pair barely reacted to US data, which hurt just modestly the USD and with the pair now trading around 1.1560 ahead of the US opening. In the 4 hours chart, the pair is currently trading below its 20 SMA, which caps the upside ever since the week started, while technical indicators bounced modestly within negative levels, but remain below Wednesday's highs, which were also made in bearish readings, all of which maintains the risk leant to the downside, at least as long as the price remains below the 1.1595 resistance. Renewed selling interest below the 1.1510 region should result in a steeper decline, with a possible downward target at 1.1420.

Support levels: 1.1510 1.1460 1.1420

Resistance levels: 1.1595 1.1630 1.1660

View Live Chart for the EUR/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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