EUR/USD Forecast: Bullish, facing a critical resistance area around 1.1350

Matías Salord FXStreet

EUR/USD Current Price: 1.1342

US weekly jobless claims dropped more than expected to 1314K
Wall Street mixed ahead of the opening amid low volatility.
EUR/USD is bullish in the short-term, after posting highest close in almost a month.

The EUR/USD pair is trading around the same level it closed on Wednesday, at the 1.1330/40 area, attempting to rise back above 1.1350. Earlier on Thursday, the pair peaked at 1.1370, the highest level in four weeks. The greenback then managed to stabilized and trimmed a small part of its recent losses across the board, favoring the correction in EUR/USD. The greenback continues to be under pressure, trading near monthly lows. Equity markets are mixed across the world. An improvement in risk sentiment could clear the way for more losses for the USD.

Economic data did not alter market sentiment. US weekly initial jobless claims came in a 1314K slightly below the 1375K expected. Also continuing claims fell more than expected to 18,062K against 19,290K. Claims continue to show an improvement in the situation of the labor market, but still numbers are far from normal (negatively). Coronavirus cases data in the US to be released over the next hours will be watched closely.

EUR/USD short-term technical outlook

The EUR/USD pair is trading near 1.1350 and bullish, in a short-term ascendant channel above key moving averages. If it rises above 1.1350 the momentum would favor another test of the daily high at the 1.1370 region. A consolidation clearly above 1.1375 would suggest more gains ahead and a test to 1.1400. The positive short-term outlook will remain in place as long as it holds above 1.1300; a break lower would suggest an extension of the correction. A close under 1.1255 (20-day moving average) could point to an interim peak.

Support levels: 1.1315 1.1295 1.1260

Resistance levels: 1.1370 1.1400 1.1425

View Live Chart for the EUR/USD

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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