EUR/USD Current Price: 1.0405

  • The European Commission is preparing another sanctions package on Russia.
  • The US celebrates Thanksgiving, leaving the FX lifeless ahead of the weekend.
  • EUR/USD is technically neutral-to-bullish, needs to break above 1.0480.

The EUR/USD pair trades just above the 1.0400 figure on a dull trading day. The pair saw some activity during Asian trading hours, helped by the latest FOMC Meeting Minutes, which hinted at a potentially more discrete rate hike next December. The news put the US Dollar in sell-off mode, helping the pair to reach a fresh weekly high of 1.0447.

During London trading hours, Germany published the November IFO survey. The Business Climate improved by more than anticipated, hitting 86.3 after the October reading was confirmed at 84.5. Expectations were up to 80, while the assessment of the current situation also improved, although by less than anticipated.

Member of the ECB's Executive Board Isabel Schnabel noted that the European Central Bank would need to raise interest rates further, probably into restrictive territory. Also, European Commission President Ursula von der Leyen announced they are working full speed on a 9th sanctions package on Russia.  Market activity declined afterwards as US markets are closed due to the Thanksgiving holiday.

The United States will not publish macroeconomic figures on Friday, and local markets are due to an early close. Germany will release the December GFK Consumer Confidence Survey, foreseen at -39.6 from -41.9 in the previous month.

EUR/USD short-term technical outlook

Technically, the daily chart for the EUR/USD pair shows that the risk remains skewed to the upside. The pair is once again battling a mildly bearish 200 SMA, while the 20 SMA maintains its bullish slope above a flat 100 SMA, both below the current level. The Momentum indicator retreated from its peak within overbought readings, heading south far above its 100 level and falling short of hinting at another leg south. Finally, the RSI indicator consolidates at around 65, reflecting the absence of directional strength.  

The 4-hour chart shows dwindling upward strength, as technical indicators eased from their intraday highs but hold well above their midlines. The 20 SMA advances below the current level, developing above a Fibonacci support level at 1.0305, the 23.6% retracement of the 0.9729/1.0480 rally. The pair needs to advance beyond 1.0480 to resume the bullish path, but it seems unlikely it could gain such momentum in tinned market conditions.

Support levels: 1.0360 1.0305 1.0260

Resistance levels: 1.0440 1.0480 1.0525

View Live Chart for the EUR/USD

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