EUR/USD Analysis: Struggles near multi-month lows ahead of German/Eurozone GDP, US retail sales

  • EUR/USD remained depressed and continued with its recent bearish trajectory.
  • The USD benefitted from fresh coronavirus concerns and kept exerting pressure.
  • Investors now eye important Eurozone macro data for some immediate respite.

The EUR/USD pair remained under some intense selling pressure on Thursday and added to its recent heavy losses. A fresh wave of the global risk-aversion – amid renewed concerns over the outbreak of the deadly coronavirus – benefitted the US dollar's perceived safe-haven status against its European counterpart and continued exerting some pressure on the major. Market worries resurfaced on Thursday after China's Hubei province reported a surge in the number of people infected, as the death toll neared 1,400. The greenback was further supported by a late rebound in the US Treasury bond yields, led by an intraday recovery in the US equity markets. 

Bearish pressure remains unabated

On the economic data front, the final German CPI for the month of January matched the preliminary readings. From the US, the headline CPI accelerated to 2.5% YoY rate, up from 2.3% previous, while the core reading was unchanged at 2.3%. The macro data, however, did little to provide any meaningful impetus. Despite extremely oversold conditions, the shared currency failed to gain any respite, rather was being weighed down by growing pessimism over the economic growth in the Eurozone. Hence, Friday's key focus will be on the preliminary estimate of the German and Eurozone Q4 GDP growth figures, which will play a key role in influencing the near-term sentiment surrounding the common currency.

Ahead of the key release, the pair remained depressed for the third consecutive session – also marking its ninth day of a negative move in the previous tend – and traded below mid-1.0800s, the lowest level since April 2017 through the Asian session. Later during the early North-American session, the US monthly retail sales data, followed by the Michigan Consumer Sentiment Index might further contribute towards producing some short-term opportunities on the last trading day of the week. 

Short-term technical outlook

From a technical perspective, extreme oversold conditions warrant some caution for bearish traders. Immediate support is pegged near the 1.0820 level, below which the pair might turn vulnerable to accelerate the slide towards the 1.0800 round figure mark. The downward momentum could further get extended towards a support marked by the lower end of over one-year-old descending trend-channel, currently near the 1.0780 region.

On the flip side, the previous 2020 swing lows, around the 1.0880 area, now seems to act as an immediate resistance, which if cleared might trigger a short-covering bounce. The pair then might move back above the 1.0900 mark and test the 1.0925 supply zone. Some follow-through buying might lift the pair towards challenging the 1.0980 strong horizontal support break-point before aiming to reclaim the key 1.10 psychological mark.


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.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD trying to set an interim bottom

EUR/USD has been consolidating around 1.0800 for a second consecutive day, ignoring risk-off and broad dollar’s demand. The case for a corrective advance becomes stronger.


USD/JPY stabilizes around 112.00 fresh 2020 highs

The USD/JPY pair has finally stalled at 112.22 but holds on to most of its latest gains. Buyers defending the downside in the 111.60/70 price zone.


AUD/USD at an over one-decade low near 0.6600

An uptick in the Australian unemployment rate, moving further away from RBA’s desired 4.5% level took its toll on the Aussie, also pressured by ruling risk-off.


Gold jumps to the highest level since February 2013, around $1620 area

Gold reversed an early dip to the $1604 area and jumped to fresh multi-year tops during the mid-European session on Thursday.

Gold News

FXStreet launches Real-Time Trading Signals

FXStreet Signals offers access to explanatory live webinars, real-time notifications when signals are triggered and exclusive membership to the company’s Telegram group, where users get direct guidance by our analysts and get room to discuss and interact.

More info

Forex Majors