EUR/USD Forecast: Bulls take their chances

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0979

The United States will publish the final estimate of the Q3 Gross Domestic Product.
The US Dollar remains on the back foot as Treasury yields reach fresh multi-month lows.
EUR/USD maintains the upward pressure, aims to test sellers’ strength around 1.1000.

The EUR/USD pair recovered its bullish poise on Thursday, and nears the weekly high posted on Monday at 1.0987, as the US Dollar resumed its slide ahead of United States (US) first-tier data. Wall Street ended its winning streak, and major indexes closed in the red in the previous session, dragging Asian and European indexes lower.

The USD could not take advantage of the worsening mood as government bond yields extended their slides. In pre-opening trading, the 10-year Treasury note yielded as low as 3.86%, a fresh multi-month low, while the 2-year note offered a minimum of 4.34%, a level that was last seen in June.

Market participants are now waiting for the release of the final estimate of the US Q3 Gross Domestic Product (GDP), expected to confirm an annualized pace of growth of 5.2%. The country will also publish a revision of quarterly Personal Consumption Expenditures Prices and Initial Jobless Claims for the week ending December 15.

EUR/USD short-term technical outlook

The EUR/USD pair seems poised to extend gains as it pressures its weekly high. Technical readings in the daily chart support the case for a bullish continuation, as technical indicators aim north above their midlines, reaching fresh December highs. At the same time, the pair develops above all its moving averages, which anyway remain directionless. Still, the 20 Simple Moving Average (SMA) converges with the 23.6% Fibonacci retracement of the 1.0447/1.1016 rally, providing support at 1.0883.

The near-term picture also skews the risk to the upside. Technical indicators head firmly north within positive levels, while a mildly bullish 20 SMA continues to provide near-term support while developing above the longer ones.

Support levels: 1.0950 1.0915 1.0880

Resistance levels: 1.1015 1.1050 1.1090

View Live Chart for EUR/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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