EUR/USD Current Price: 1.2086
- US Treasury yields ticked lower, frenzy seems over for now.
- The focus shifts to the services sector, with updates on EU and US PMIs.
- EUR/USD in recovery mode but below the 1.2100 level.
Dollar buyers paused in the latest American session, helping EUR/USD recover from a fresh weekly low of 1.1991. European indexes posted modest gains but failed to support Wall Street, as US indexes edged lower. Meanwhile, US Treasury yields ticked lower, holding within familiar levels, as investors brace for positive economic hints.
European data disappointed, as German Retail Sales fell by 4.5% MoM in January, while the year-on-year comparison came in at -8.7%. European inflation was up by 0.9% YoY in February, according to preliminary estimates, missing the market’s expectations. The absence of inflationary pressures may have helped cooling government bond yields. The US published the February ISM-NY Business Conditions Index, which contracted to 35.5 from 51.2, and March IBD/TIPP Economic Optimism printed at 55.4 from 51.9 in the previous month.
This Wednesday, Markit will publish the final versions of its February Services PMIs for the EU and the US. The services sector is the most hit by the pandemic, and downward revisions shouldn’t surprise. The US will release the official ISM Services PMI, foreseen stable at 58.7.
EUR/USD short-term technical outlook
The EUR/USD pair trades at daily highs a few pips below the 1.2100 level, but despite the roughly 100 pips comeback, the bullish potential seems limited. In the 4-hour chart, the pair is struggling around a firmly bearish 20 SMA, unable to advance beyond it. Technical indicators have recovered from oversold levels but lost bullish strength below their midlines. The advance could continue if the pair manages to extend the current advance beyond 1.2120, the immediate resistance level.
Support levels: 1.2060 1.2015 1.1970
Resistance levels: 1.2120 1.2170 1.2215
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.