EUR/USD Current Price: 1.0798
- Coronavirus-related concerns eased, but investors maintain a cautious stance.
- EU macroeconomic figures missed the market’s expectations, US data upbeat.
- EUR/USD hovering sub-1.0800, to gain bearish momentum below 1.0770.
The EUR/USD pair has spent Wednesday confined to a tight range around the 1.0800 level, extending its yearly decline by a few pips to 1.0781. Coronavirus-related concerns eased amid Chinese authorities reporting that the pace of contagion outside the Hubei province has slowed, although the dollar and gold, both considered safe-haven, retained their strength, suggesting investors are still cautious.
Macroeconomic data continued to highlight the imbalances between the two economies. The EU released December Current Account with the seasonally adjusted figure at €32.6 B, missing the market’s expectations. The Union also released December Construction output, which also came in below expected, down by 3.1% MoM and by 3.7% YoY. The US published the January Producer Price Index, which was up by 2.1% YoY, beating the market’s expectations. Housing Starts in the same month were down by 3.6% while Building Permits were up by 9.2%, both much better than anticipated.
This Thursday, Germany will release the GFK Consumer Confidence Survey, seen in March at 9.8, down from 9.9 previously, and January PPI, foreseen down by 0.4% YoY. The EU will publish the preliminary estimate of February Consumer Confidence, seen at -8.2 from -8.1. The US will release the usual weekly unemployment data and the Philadelphia Fed Manufacturing Survey, seen in February at 12 after printing 17 in January. The US Federal Reserve released the Minutes of its latest meeting, but it was a non-event.
EUR/USD short-term technical outlook
The EUR/USD pair hovers around 1.0790 ahead of the Asian opening, holding on to its bearish stance according to the 4-hour chart. The pair continues to develop below a bearish 20 SMA, while the Momentum indicator eases within negative levels and the RSI consolidates in oversold levels. The pair is extremely oversold but with no signs of changing course. A bullish corrective advance is not out of the cards, although a break below 1.0770 should open doors for another leg south.
Support levels: 1.0770 1.0725 1.0690
Resistance levels: 1.0840 1.0885 1.0910
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 fluctuates near 1.0700 after US data
EUR/USD stays in a consolidation phase at around 1.0700 in the American session on Wednesday. The data from the US showed a strong increase in Durable Goods Orders, supporting the USD and making it difficult for the pair to gain traction.
USD/JPY refreshes 34-year high, attacks 155.00 as intervention risks loom
USD/JPY is renewing a multi-decade high, closing in on 155.00. Traders turn cautious on heightened risks of Japan's FX intervention. Broad US Dollar rebound aids the upside in the major. US Durable Goods data are next on tap.
Gold stays in consolidation above $2,300
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Worldcoin looks set for comeback despite Nvidia’s 22% crash Premium
Worldcoin price is in a better position than last week's and shows signs of a potential comeback. This development occurs amid the sharp decline in the valuation of the popular GPU manufacturer Nvidia.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.