EUR/USD Forecast: Dollar breaths, but it’s still weak

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1809

Month-end flows gave the greenback the chance of recovering some ground.
US CB Consumer Confidence contracted by more than anticipated in August to 113.8.
EUR/USD retreated towards 1.1800, further losses still unclear.

The EUR/USD pair retreated from a multi-week high of 1.1844 to currently flirting with the 1.1800 level, as the American currency recovered on the back of month-end flows and despite poor US data. The US published August CB Consumer Confidence, which plunged to 113.8 in August from 129.1 previously, amid concerns related to the spread of the coronavirus Delta variant. Also, the Chicago Purchasing Managers’ Index for the same month, contracted by more than anticipated, to66.8 from 73.4 in the previous month.

On the other hand, European data was upbeat. The German Unemployment rate contracted to 5.5% in August, while the EU Consumer Price Index was confirmed at 1.6% YoY in August, according to preliminary estimates. On Wednesday, Germany will release July Retail Sales, while Markit will unveil the final versions of its Manufacturing PMIs. The US will publish the official ISM Manufacturing PMI and the ADP report on job creation, expected to print at 613K.

EUR/USD short-term technical outlook

The EUR/USD pair settled below the 61.8% retracement of its latest daily slump at 1.1820, the immediate resistance level. The 4-hour chart shows that the pair holds above all of its moving averages, with the 20 SMA heading firmly higher and crossing above the longer ones. Meanwhile, technical indicators are retreating from overbought readings, but are currently flat and holding within positive levels. The pair can turn bearish on a break below 1.1780, the 50% retracement of the mentioned daily decline.

Support levels: 1.1780 1.1745 1.1700

Resistance levels: 1.1820 1.1850 1.1890

View Live Chart for the EUR/USD

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

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.

EUR/USD weakens to near 1.1900 as traders eye US data

The EUR/USD pair loses ground to around 1.1905, snapping the two-day winning streak during the early European trading hours on Tuesday. Markets might turn cautious ahead of the release of key US economic data, including US employment and inflation reports that were pushed back slightly due to the recently ended four-day government shutdown.

GBP/USD edges lower below 1.3700 on UK political risks, BoE rate cut bets

The GBP/USD pair trades on a weaker note around 1.3685 during the European session on Tuesday. The Pound Sterling edges lower against the US Dollar amid political risk in the United Kingdom and rising expectations of near-term Bank of England rate cuts.

Gold drifts lower as positive risk tone tempers safe-haven demand; downside seems limited

Gold drifts lower during the Asian session on Tuesday and snaps a two-day winning streak, though it lacks strong follow-through selling and shows some resilience below the $5,000 psychological mark amid mixed cues. The outcome of Japan's snap election on Sunday removes political uncertainty, which, along with signs of easing tensions in the Middle East, remains supportive of the upbeat market mood.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.

Follow the money, what USD/JPY in Tokyo is really telling you

Over the past two Tokyo sessions, this has not been a rate story. Not even close. Interest rate differentials have been spectators, not drivers. What has moved USD/JPY in local hours has been flow and flow alone.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash (BCH) trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.