EUR/USD Current Price: 1.1141
- US Gross Domestic Product was up at an annualized pace of 6.9% in Q4 2021.
- Wall Street recovered the ground lost after the Fed’s hawkish announcement.
- EUR/USD consolidates losses near a 19-month low, could fall further in the near term.
The EUR/USD pair fell on Thursday to 1.1130, a level that was last seen in May 2020. The dollar appreciated through all sessions, surging in Asia on the back of a hawkish US Federal Reserve and hints for a rate hike in March coming from chief Jerome Powell himself. The greenback gained additional momentum after the US reported its annualized quarterly growth, as the Gross Domestic Product surpassed expectations in Q4 2021 by printing 6.9%.
The positive figure also fueled equities temporarily, as Wall Street recovered all the ground lost post-Fed's decision, although indexes trimmed gains heading into the close. The US also reported Initial Jobless Claims, which printed at 260K in the week ended January 14, as expected, while December Durable Goods Orders missed the market’s expectations, down by 0.9% in the month.
On Friday, Germany will release the preliminary estimate of its Q4 GDP, while the EU will publish the January Economic Sentiment Indicator. As for the US, the country will publish December Personal Consumption Expenditures, including the core PCE Price Index, foreseen a 4.8% YoY, and the January Michigan Consumer Sentiment Index.
EUR/USD short-term technical outlook
The EUR/USD pair heads into the Asian opening trading near the mentioned daily low, anticipating a bearish continuation despite extreme oversold readings in near-term charts. In the daily chart, the pair has collapsed below all of its moving averages, while the Momentum indicator heads south almost vertically, approaching oversold levels. The RSI indicator, in the meantime, maintains its bearish slope at around 32.
The 4-hour chart shows that technical indicators pared their slides, with the Momentum recovering modestly and the RSI consolidating around 18. Meanwhile, the 20 SMA accelerated south below the longer ones, reflecting strong selling interest. As long as the pair remains below the 1.1200 price zone, the risk will remain to the downside, with approaches to the latter probably attracting sellers.
Support levels: 1.1105 1.1060 1.1015
Resistance levels: 1.1185 1.1220 1.1260
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD extends gains above 1.0700, focus on key US data
EUR/USD meets fresh demand and rises toward 1.0750 in the European session on Thursday. Renewed US Dollar weakness offsets the risk-off market environment, supporting the pair ahead of the key US GDP and PCE inflation data.
USD/JPY keeps pushing higher, eyes 156.00 ahead of US GDP data
USD/JPY keeps breaking into its highest chart territory since June of 1990 early Thursday, recapturing 155.50 for the first time in 34 years as the Japanese Yen remains vulnerable, despite looming intervention risks. The focus shifts to Thursday's US GDP report and the BoJ decision on Friday.
Gold closes below key $2,318 support, US GDP holds the key
Gold price is breathing a sigh of relief early Thursday after testing offers near $2,315 once again. Broad risk-aversion seems to be helping Gold find a floor, as traders refrain from placing any fresh directional bets on the bright metal ahead of the preliminary reading of the US first-quarter GDP due later on Thursday.
Injective price weakness persists despite over 5.9 million INJ tokens burned
Injective price is trading with a bearish bias, stuck in the lower section of the market range. The bearish outlook abounds despite the network's deflationary efforts to pump the price.
US Q1 GDP Preview: Economic growth set to remain firm in, albeit easing from Q4
The United States Gross Domestic Product (GDP) is seen expanding at an annualized rate of 2.5% in Q1. The current resilience of the US economy bolsters the case for a soft landing.