EUR/USD Current Price: 1.1672
- The ECB hinted more easing coming in December, will “recalibrate” all available tools.
- US economy grew at a faster than expected pace in the three months to September.
- EUR/USD is oversold in the near-term, but more slides could be expected.
The shared currency remained under selling pressure, falling against its American rival to 1.1649, a fresh one-month low. A dismal mood led the way throughout the first half of the day, with Asian and European equities extending their slumps. Upbeat US data paused equities’ bleeding, but a dovish ECB fueled the sour sentiment. The US dollar was once again the daily winner, further supported by Initial Jobless Claims shrinking further in the week ended October 23 and the preliminary estimate of the Q3 Gross Domestic Product, which printed an annualized 33.1%, above the 31% expected.
The ECB left its monetary policy unchanged as widely expected, with the deposit rate unchanged at -0.5% and the main rate at 0.0%. President Christine Lagarde’s statement was quite dovish, as she hinted more easing coming in December when the central bank will present fresh forecasts. Lagarde said that the whole Government Council agreed on extending the easing program. She gave no details but added that all available tools would be “recalibrated,” to counter the negative economic effects of the pandemic.
This Friday, the focus will shift to Europe, as Germany and the EU will publish their preliminary estimates of Q3 GDP. The German economy is seen growing by 7.3%, while the EU GDP is seen expanding by 9.4% when compared to the previous quarter. Annual comparisons, however, are still seen in negative levels.
EUR/USD short-term technical outlook
The EUR/USD pair is trading near the mentioned daily low, maintaining its bearish potential heading into the Asian opening. The 4-hour chart shows that the pair is developing below all of its moving averages, with the 20 SMA accelerating south and about to cross below the 200 SMA. The Momentum indicator consolidates losses while the RSI is barely correcting extreme oversold conditions, indicating prevalent selling interest. A break below 1.1640 will likely signal an extension sub-1.16 in the upcoming sessions.
Support levels: 1.1640 1.1600 1.1560
Resistance levels: 1.1685 1.1720 1.1770
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 edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.