EUR/USD Forecast: Dollar’s demand receded despite the dismal mood

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1842

Softer than expected US data weighed on the greenback, despite the mood remained sour.
The US will publish this Friday the September Michigan Consumer Sentiment Index.
EUR/USD bounced from a fresh one-month low, but the risk remains skewed to the downside.

The EUR/USD pair fell to 1.1736 its lowest in over a month, on the heels of demand for safety, spurred by the US Federal Reserve on Wednesday. Equities plunged in Asia, dragging their overseas counterparts to the downside. European indexes, however, shrug off most of the intraday losses, helping the pair to recover some ground. It currently trades at around 1.1840, despite Wall Street’s sour tone.

The EU published August inflation figures, with the annual CPI confirmed at -0.2% as previously estimated. As for the US, the country has just published Initial Jobless Claims for the week ended September 11, which came in at 860K improving from 893K in the previous week but worse than the 850K anticipated. The country also published August Building Permits and Housing Starts, which increased by less than anticipated. Sour US data added to the dollar’s negative tone. This Friday, the EU will publish its July Current Account, while the US will unveil the preliminary estimate of the September Michigan Consumer Sentiment Index, foreseen at 75 from 74.1 in the previous month.

EUR/USD short-term technical outlook

The EUR/USD pair has corrected extreme oversold conditions, but the risk remains skewed to the downside, according to intraday technical readings. The 4-hour chart shows that the pair is trading below all of its moving averages, which remain all together in a 20 pips’ range, while technical indicators posted modest recoveries within negative levels. The pair is back to trade within familiar levels and would need to extend its advance beyond the 1.1880 price zone to have chances of rallying further.

Support levels: 1.1795 1.1750 1.1710

Resistance levels: 1.1840 1.1880 1.1915

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 stays defensive below 1.1900 as USD recovers

EUR/USD trades in negative territory for the third consecutive day, below 1.1900 in the European session on Thursday. A modest rebound in the US Dollar is weighing on the pair, despite an upbeat market mood. Traders keep an eye on the US weekly Initial Jobless Claims data for further trading impetus.

GBP/USD holds above 1.3600 after UK data dump

\GBP/USD moves little while holding above 1.3600 in the European session on Thursday, following the release of the UK Q4 preliminary GDP, which showed a 0.1% growth against a 0.2% increase expected. The UK industrial sector activity deteriorated in Decembert, keeping the downward pressure intact on the Pound Sterling.

Gold sticks to modest intraday losses as reduced March Fed rate cut bets underpin USD

Gold languishes near the lower end of its daily range heading into the European session on Thursday. The precious metal, however, lacks follow-through selling amid mixed cues and currently trades above the $5,050 level, well within striking distance of a nearly two-week low touched the previous day.

Cardano eyes short-term rebound as derivatives sentiment improves

Cardano (ADA) is trading at $0.257 at the time of writing on Thursday, after slipping more than 4% so far this week. Derivatives sentiment improves as ADA’s funding rates turn positive alongside rising long bets among traders.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Sonic Labs’ vertical integration fuels recovery in S token

Sonic, previously Fantom (FTM), is extending its recovery trade at $0.048 at the time of writing, after rebounding by over 12% the previous day. The recovery thesis’ strengths lie in the optimism surrounding Sonic Labs’ Wednesday announcement to shift to a vertically integrated model, aimed at boosting S token utility.