EUR/USD Current price: 1.1649
- Holidays in London and Wall Street to see the week starting in slow motion.
- European inflation and US employment data to provide fresh clues this week.
Geopolitical fears returned last week, and the greenback once again had an upbeat performance against its European rivals, losing ground, on the contrary again safe-haven rivals. The EUR/USD pair settled at 1.1649, its lowest since November last year, and accumulating a roughly 800 pips' decline since topping around 1.2410 mid-April. The common currency had its fair share of own trouble, with political jitters in Italy and Spain, and data indicating that the pace of growth continued decelerating into Q2. US Treasury yields continued easing, with the yield on the benchmark 10-year Treasury note, down roughly 10 basis points from the multi-year high achieved this month, now at 2.93%.
With a holiday in London and Wall Street, the week is set once again to start in slow motion. Nevertheless, the macroeconomic calendar will be quite active for both economies these upcoming days, with fresh inflation figures for Germany and the EU, and the US Nonfarm Payroll report next Friday, among others. These numbers will give fresh clues on the imbalances between the two economies and their central banks' policies, and regardless sentiment will set the tone for the pair.
Technically, the pair is down for a sixth consecutive week, and despite extremely oversold, there are no signs of a trend-change just yet. In the daily chart, the 20 DMA heads firmly lower above the current level and after crossing below the larger ones, while the Momentum indicator hovers within negative territory, with no certain directional strength, but the RSI accelerates south, now at 22. In the 4 hours chart, the pair is developing below all of its moving averages, with the 20 SMA providing a dynamic resistance at around 1.1720, and technical indicators turning lower within negative territory, the RSI currently at 30, all of which favors additional declines, now targeting the 1.1550 region, where the pair bottomed in November 2017.
Support levels: 1.1620 1.1590 1.1550
Resistance levels: 1.1695 1.1720 1.1750
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