EUR/USD Forecast: bears waiting for a catalyst

  • EU Q3 GDP seen unchanged from initial estimates.
  • US Political woes ignored ahead of Nonfarm Payroll report.

The common currency remains confined to a tight intraday range against its American rival this Thursday, showing little life during Asian trading hours. The EUR/USD pair, however, broke below the 1.1800 level on Wednesday,  amid continued dollar's demand and softer-than-expected macroeconomic figures in different economies that fueled the advance. Greenback's strength remains intact, despite a possible US Government shutdown this weekend  amid the federal spending having reached the debt ceiling.  

In the data front, the EU will release its final version of Q3 GDP today, expected unchanged from preliminary estimates, with quarterly growth up 0.6%. As for the US, attention will gyrate around minor employment figures, relevant ahead of US Nonfarm Payrolls this Friday. Challenger job cuts for November, and weekly unemployment claim figures.

The pair has broken some relevant levels this week, starting with the 61.8% retracement of the latest bullish run, at 1.1800. In the 4 hours chart, the pair has extended below its 100 SMA, the first time below the indicator since November 13th, while the 20 SMA has gained bearish strength above the largest, now about to cross it. In the mentioned chart, the Momentum indicator maintains its slope downward now at its lowest for December, while the RSI is neutral-to-bearish near oversold levels.

From the current level, the pair has scope to fall  down to the 1.1750/60 price zone, while below this last 1.1720 comes next. Beyond 1.1800, the pair would need to surpass 1.1820/30 to be able to extend its advance, up to the 1.1870 where selling interest has contained bulls ever since the week started.

View live chart of the EUR/USD

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 securities. 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 Forex 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.