- EUR/USD went into a consolidation phase near 1.1000 early Friday.
- US PCE inflation data could drive the USD valuation in the American session.
- Thin trading conditions ahead of Christmas holiday could limit the pair's action.
EUR/USD gathered bullish momentum and climbed above 1.1000 on Thursday as the US Dollar came under bearish pressure following the mixed data releases. The pair holds steady at around 1.1000 early Friday ahead of the Personal Consumption Expenditures (PCE) Price Index data from the US.
The US Bureau of Economic Analysis (BEA) announced on Thursday that it revised the annualized third-quarter Gross Domestic Product (GDP) growth lower to 4.9% from 5.2%. The GDP Price Index in the same period was also lowered to 3.3% from 3.5%, showing that inflation had a smaller effect on the GDP growth than initially estimated.
Although other data from the US revealed that there were 205,000 Initial Jobless Claims in the week ending December 16, compared to the market expectation of 215,000, the USD weakened against its rivals in the American session.
Euro price this week
The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the US Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -1.08% | -0.21% | -0.78% | -1.37% | -0.10% | -1.16% | -1.74% | |
| EUR | 1.06% | 0.85% | 0.30% | -0.29% | 0.96% | -0.09% | -0.66% | |
| GBP | 0.21% | -0.86% | -0.57% | -1.16% | 0.08% | -0.95% | -1.52% | |
| CAD | 0.77% | -0.30% | 0.56% | -0.59% | 0.65% | -0.39% | -0.96% | |
| AUD | 1.35% | 0.29% | 1.14% | 0.59% | 1.25% | 0.21% | -0.37% | |
| JPY | 0.11% | -0.96% | -0.10% | -0.66% | -1.26% | -1.06% | -1.63% | |
| NZD | 1.15% | 0.08% | 0.94% | 0.39% | -0.20% | 1.05% | -0.57% | |
| CHF | 1.70% | 0.65% | 1.51% | 0.95% | 0.36% | 1.58% | 0.57% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Ahead of the Christmas break, the BEA will publish the PCE Price Index data, the Federal Reserve's preferred gauge of inflation. A smaller-than-forecast increase in the monthly Core PCE Price Index, which excludes volatile food and energy prices, could weigh on the USD. On the other hand, a significant upside surprise could have the opposite impact on the currency's performance against its rivals.
Nevertheless, the market reaction to the US data could remain short-lived, with trading volumes thinning out heading into the long weekend.
EUR/USD Technical Analysis
EUR/USD stabilized within the upper half of the ascending regression trend channel and the Relative Strength Index (RSI) indicator on the 4-hour chart rose above 60 after retreating toward 50 mid-week, reflecting a bullish bias for the pair in the near term.
On the upside, 1.1050 (static level) aligns as next resistance before 1.1100 (psychological level, static level) and 1.1150 (upper limit of the ascending trend channel).
In case EUR/USD fails to hold above 1.1000 and starts using that level as resistance, technical sellers could show interest. In this scenario, supports could be seen at 1.0925 (50-period Simple Moving Average (SMA)), 1.0900 (psychological level) and 1.0870 (100-period SMA, 200-period SMA).
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