EUR/USD Analysis: challenge of 1.1100 threshold around the corner

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1136

A holiday in Europe maintains the shared currency under pressure.
Upbeat US Retail Sales lift the dollar ahead of Wall Street’s opening.
EUR/USD at risk of extending its slump, sentiment making big noise in the way.

The EUR/USD pair recovered just modestly from 1.1130, the low set Wednesday, to reach a daily high of 1.1158. Sentiment continues to lead the way in the financial world, and particularly for the shared currency, as several countries in the Union are on holiday. That said, the EU macroeconomic calendar remained empty this Thursday. The market’s mood attempted to improve early Europe, but news coming from China turned it back sour, as the country threatened to retaliate against the latest round of Trump’s tariffs, accusing the US to violate the accord made in Osaka.

In the US, on the other hand, data was upbeat. Retail Sales increased by 0.7% in July, more than doubling the 0.3% expected advance. The core Retail Sales Control Group printed 1.0% against the 0.3% expected. Also, the NY Empire State Manufacturing Index for August resulted at 4.8, while the Philly Manufacturing Survey for the same period rose to 16.8, both surpassing the market’s forecast. Finally, Initial Jobless Claims for the week ended August 9, came in at 220K worse than the expected 214K. More US data is coming ahead.

EUR/USD short-term technical outlook

The EUR/USD pair is barely holding above its weekly low, battling with the 50% retracement of its latest daily advance. In the 4 hours chart, sellers surged around a bearish 100 SMA, with the pair developing below all of its moving averages. The 38.2% retracement of the mentioned rally comes at 1.1160, providing a more relevant resistance. Technical indicators are neutral-to-bearish well into negative levels, keeping the risk skewed to the downside.

Support levels: 1.1125 1.1080 1.1045

Resistance levels: 1.1160 1.1195 1.1230

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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