EUR/USD Forecast: Euro could push higher as long as 1.0560 support holds

EUR/USD has started the new week on a firm footing.
The near-term technical outlook suggests that buyers remain active.
The pair could preserve its bullish momentum in case risk flows continue to dominate the markets.

Eren Sengezer FXStreet

EUR/USD has regathered bullish momentum early Monday and climbed higher toward 1.0600. Improving market mood seems to be helping the shared currency find demand at the start of the week and the near-term technical outlook points to a bullish tilt.

Risk flows dominate the financial markets early Monday as investors reassess major central banks' tightening prospects amid growing signs of a slowdown. The Europe Stoxx 600 Index is up more than 1% in the European morning and US stock index futures are rising between 0.5% and 0.8%, confirming the risk-positive atmosphere.

It's worth noting, however, that European Union members are reportedly discussing a ban on Russian gold imports. In case geopolitical tensions escalate with Russia looking to respond to such action, investors could start seeking refuge and make it difficult for the euro to preserve its strength.

In the second half of the day, May Durable Goods Orders and Pending Home Sales data will be featured in the US economic docket. On Friday, the data from the US showed that New Home Sales unexpectedly rose by 10.7% in May and Wall Street's main indexes registered impressive daily gains. Pending Home Sales are expected to decline by 4% in May and a positive surprise could help US stocks push higher and force the greenback to stay on the backfoot in the American trading hours.

Later in the day, European Central Bank (ECB) President Christine Lagarde will deliver her opening remarks at the ECB Forum on Central Banking.

EUR/USD Technical Analysis

As of writing, EUR/USD was trading slightly above the 200-period SMA on the four-hour chart, which is currently located at 1.0580. In case the pair starts using that level as support, 1.0600 (Fibonacci 61.8% retracement of the latest downtrend, psychological level) aligns as interim resistance ahead of 1.0640 (static level) and 1.0660 (static level, former support).

On the downside, key support seems to have formed at 1.0560 (Fibonacci 50% retracement, 100-period SMA). A four-hour close below that level could attract bears and cause the pair to retreat toward 1.0520 (Fibonacci 38.2% retracement, 50-period SMA) and 1.0500 (psychological level).

Meanwhile, the Relative Strength Index (RSI) indicator holds above 50, confirming the bullish shift in the short-term outlook.

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 flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.