EUR/USD Current Price: 1.0703
- Discouraging European data passed unnoticed as the focus remains on the global financial situation.
- Market players await the United States Federal Reserve’s decision on monetary policy.
- EUR/USD has room to extend its advance, faces strong resistance around 1.0745.
Financial markets started the week with cautious optimism amid weekend news indicating the UBS Group AG would buy Credit Suisse Group AG by $3.23 billion. The Swiss National Bank stated on Sunday the rescue would “secure financial stability and protect the Swiss economy.” EUR/USD gapped higher at the weekly opening but fell towards 1.0630 early in the European session. It later resumed its advance and currently trades just above the 1.0700 threshold.
Further aiding the market sentiment, the United States Federal Reserve (Fed) announced that it would offer daily swaps to its major counterparts to ensure they have enough liquidity to continue operations. The American central bank will announce its decision on monetary policy next Wednesday, and market participants doubt their former conviction the Fed will proceed with an aggressive 50 bps hike but instead go on with a modest 25 bps hike or even stay pat. The central bank will also release fresh economic projections.
Data-wise, Germany published the February Producer Price Index (PPI), which rose at an annualized pace of 15.8%, higher than the 12.4% expected. The monthly reading slid by 0.3%, higher than the 0.5% decline anticipated by investors. At the same time, the Eurozone Trade Balance posted a deficit of €-11.3 billion, better than expected. The United States will not release relevant macroeconomic figures on Monday.
EUR/USD short-term technical outlook
The EUR/USD pair pressures its daily high in the 1.0710 region ahead of the US opening, and the daily chart shows that the risk of a bullish extension increased. The 20 Simple Moving Average (SMA) lacks directional strength but provides dynamic support around the aforementioned intraday low. At the same time, the 100 SMA gains upward traction below the shorter one and above the 200 SMA. Finally, technical indicators head firmly north within positive levels, supporting a continued advance. The pair faces strong resistance at around 1.0745, the 61.8% retracement of the 2022 yearly decline.
In the near term, and according to the 4-hour chart, the chances are also on the bulls’ side. The pair is currently advancing above all its moving averages, which offer neutral-to-bearish slopes. On the other hand, technical indicators picked up momentum and advance well above their midlines, supporting higher highs in the upcoming sessions.
Support levels: 1.0685 1.0640 1.0600
Resistance levels: 1.0745 1.0790 1.0825
View Live Chart for 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 assets. 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 Open Markets 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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.