EUR/USD Forecast: Daily close below 1.1200 could attract sellers

EUR/USD trades in a tight channel near 1.1200 on Thursday.
US Dollar could gather strength in case safe-haven flows dominate the markets in the American session.
Investors will keep a close eye on weekly Initial Jobless claims data.

Eren Sengezer FXStreet

Following Wednesday's slide, EUR/USD stabilized slightly above 1.1200 in the European session on Thursday. The pair's technical outlook doesn't point to a buildup of bearish momentum but a daily close below 1.1200 could attract sellers.

The renewed US Dollar (USD) strength caused EUR/USD to stay under bearish pressure midweek. Meanwhile, European Central (ECB) Bank Governing Council member Yannis Stournaras said that the ECB could stop hiking rates after 25 basis points (bps) increase in July, putting additional weight on the Euro's shoulders.

Early Thursday, US stock index futures trade in negative territory as investors stay away from risk-sensitive assets after uninspiring earnings figures from big US tech firms. In case markets remain risk-averse in the second half of the day, the USD could continue to find demand and make it difficult for EUR/USD to gain traction.

The US economic docket will feature the weekly Initial Jobless Claims data, which is forecast to rise to 242,000 from 237,000 last week. A sharp increase in the number of first-time applications for unemployment benefits could cause the USD to weaken against its rivals.

EUR/USD Technical Analysis

EUR/USD continues to trade below the lower limit of the ascending regression channel and the 20-period Simple Moving Average (SMA) on the 4-hour chart. The Relative Strength Index (RSI) indicator, however, moves sideways near 50, suggesting that the pair is yet to gather bearish momentum.

In case EUR/USD closes the day below 1.1200 (psychological level, static level) and confirms that level as resistance, additional losses toward 1.1160 (Fibonacci 23.6% retracement level of the latest uptrend, 50-period SMA) and 1.1100 (Fibonacci 38.2% retracement) could be seen.

On the upside, 1.1230 (20-period SMA) aligns as interim resistance before 1.1270 (static level from March 2022, multi-month high set on Tuesday, lower limit of the ascending channel) and 1.1300 (psychological level).

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

EUR/USD struggles near 1.1850, with all eyes on US CPI data

EUR/USD holds losses while keeping its range near 1.1850 in European trading on Friday. A broadly cautious market environment paired with a steady US Dollar undermines the pair ahead of the critical US CPI data. Meanwhile, the Eurozone Q4 GDP second estimate has little to no impact on the Euro.

GBP/USD recovers above 1.3600, awaits US CPI for fresh impetus

GBP/USD recovers some ground above 1.3600 in the European session on Friday, though it lacks bullish conviction. The US Dollar remains supported amid a softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold remains below $5,000 as US inflation report looms

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains in the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

US CPI data set to show modest inflation cooling as markets price in a more hawkish Fed

The US Bureau of Labor Statistics will publish January’s Consumer Price Index data on Friday, delayed by the brief and partial United States government shutdown. The report is expected to show that inflationary pressures eased modestly but also remained above the Federal Reserve’s 2% target.

The weekender: When software turns the blade on itself

Autonomous AI does not just threaten trucking companies and call centers. It challenges the cognitive toll booths that legacy software has charged for decades. This is not a forecast. No one truly knows the end state of AI.

Solana Price Forecast: Mixed market sentiment caps recovery

Solana (SOL) is trading at $79 as of Friday, following a correction of over 9% so far this week. On-chain and derivatives data indicates mixed sentiment among traders, further limiting the chances of a price recovery.