EUR/USD analysis: little changed in dull Monday

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1772

EUR/USD recovered from a fresh 2018 low but ends the daily pretty much flat.
US minor data beat expectations, more relevant headlines scheduled for Wednesday.

The dollar opened the day with a strong footing that anyway diluted as the sessions went by, ending the day mixed against its major rivals. In the case of EUR/USD, the pair reached a fresh 2018 low of 1.1716 before starting a bounce that was any way capped by selling interest around 1.1780. Market movements were related to equities, while these last, were driven by weekend news on easing tensions between China and US about a possible trade war. The macroeconomic calendar had nothing to offer in Europe, while US data was again positive, as the Chicago Fed National Activity Index for April resulted at 0.34 well above the 0.14 expected, while March figure was revised to 0.32 from a previous estimate of 0.10. Some FOMC members were offering different speeches, none of them able to affect the USD ahead of the Minutes of the latest meeting to be out next Wednesday. The EU has no fundamental news scheduled for this Tuesday, while the US will only offer the Richmond Fed Manufacturing Index, seen improving in May to 9 from a previous -3.

The 4 hours chart for the EUR/USD pair shows that it was unable to surpass a modestly bearish 20 SMA, holding a few pips below the indicator ahead of the Asian opening, while technical indicators have corrected oversold conditions, but hold below their midlines, suggesting that buyers remain sidelined. Chances of further recoveries will increase on a break above the 1.1800 figure, but sellers will likely reappear on an approach to 1.1880. To the downside, a break below the daily low should anticipate an extension toward the 1.1660 level, a strong mid-term support.

Support levels: 1.1740 1.1715 1.1690

Resistance levels: 1.1800 1.1845 1.1880

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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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