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EUR/USD Current Price: 1.0519

  • The US Dollar struggles to attract buyers amid some optimistic headlines.
  • EU Gross Domestic Product rose by 2.3% YoY in Q3, beating expectations.
  • EUR/USD hovers around 1.0500 with little directional strength.

The EUR/USD pair extended its weekly decline to 1.0442 on Wednesday, bouncing during London trading hours amid the better tone of European indexes. The market sentiment remains quite fragile despite some optimistic headlines. China officially relaxed its coronavirus-related measures, bringing some relief to financial markets, concerned about another potential global economic setback triggered by fresh supply-chain issues, most of which have already been resolved.

The EUR found support in European data, as the Euro Area Gross Domestic Product came in better than anticipated in the third quarter of the year, posting an annualized growth of 2.3%. The quarterly gain was o 0.3%, better than the 0.2% anticipated. Also, Employment Change in the same period was up by 0.3% QoQ, beating expectations. Finally, German Industrial Production was down by 0.1% MoM in October, better than anticipated, but remained unchanged on a yearly basis, missing the 2.3% advance expected.

The US calendar has offered MBA Mortgage Applications for the week ended December 2, which were down by 1.9%. The country will later release Nonfarm Productivity and Unit Labour Cost for the third quarter of the year and October Consumer Credit Change.

EUR/USD short-term technical outlook

The EUR/USD pair trades at its daily highs near 1.0520, maintaining the upward pressure ahead of the US opening. According to the daily chart, the pair has room to extend its gains, although it lacks directional strength. The pair keeps trading above all of its moving averages, with the 20 SMA crossing above the 200 SMA in the 1.0360/80 price zone. The 100 SMA slowly turns north, far below the current level. Meanwhile, technical indicators turned marginally higher, with the RSI at around 64 and the Momentum within neutral levels.

The near-term picture shows the upside remains limited. A flat 20 SMA caps the upside at around the daily high, while the longer ones are losing their bullish strength far below the current level. In the meantime, the Momentum remains directionless within negative levels, while the RSI picked up, currently standing at around 53. The pair would need to clear the 1.0530 area to anticipate additional gains in the upcoming sessions.

Support levels: 1.0480 1.0445 1.0400  

Resistance levels: 1.0530 1.0560 1.0610  

View Live Chart for the EUR/USD

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