EUR/USD Forecast: Investors keep seeking safety

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1773

Risk-off dominates financial markets to the benefit of the greenback.
Stocks are sharply down, Wall Street is poised to open the red.
EUR/USD is pressuring fresh three-month lows and poised to extend its slump.

The American dollar is up this Monday as investors seek safety. The EUR/USD pair fell to 1.1763, its lowest since early April, and holding nearby ahead of Wall Street’s opening. Soaring demand for government bonds sent yields down, with that on the US 10-year Treasury note currently at 1.22%. Stocks are firmly down in Europe, dragging US futures lower.

There is no particular reason behind the sour mood but a combination of global factors. In Europe, mounting tensions around Brexit and the coronavirus Delta variant top the list, although the UK has fully reopened in what they called “freedom day.” In the US, soaring inflation coupled with a dovish Federal Reserve seems to be the main cause of tensions.

On the data front, There’s not much to take care of. The EU published May Construction Output, which was up 0.9% MoM and 13.6% YoY. The US will publish the June NAHB Housing Market Index, expected at 82.

EUR/USD short-term technical outlook

The EUR/USD pair is developing inside a descendant channel, maintaining the bearish tone in the near-term and poised to extend its slide. The 4-hour chart shows that it met intraday sellers around a directionless 20 SMA, although the longer moving averages maintain their bearish slopes well above it. Technical indicators stand at daily lows within negative levels, with moderated bearish strength. The next relevant support and the probable bearish target is 1.1720.

Support levels: 1.1760 1.1720 1.1685

Resistance levels: 1.1840 1.1885 1.1920

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 struggles near 1.1850, with all eyes on US CPI data

EUR/USD holds losses while keeping its range near 1.1850 in European trading on Friday. A broadly cautious market environment paired with a steady US Dollar undermines the pair ahead of the critical US CPI data. Meanwhile, the Eurozone Q4 GDP second estimate has little to no impact on the Euro.

GBP/USD recovers above 1.3600, awaits US CPI for fresh impetus

GBP/USD recovers some ground above 1.3600 in the European session on Friday, though it lacks bullish conviction. The US Dollar remains supported amid a softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold remains below $5,000 as US inflation report looms

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains in the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

US CPI data set to show modest inflation cooling as markets price in a more hawkish Fed

The US Bureau of Labor Statistics will publish January’s Consumer Price Index data on Friday, delayed by the brief and partial United States government shutdown. The report is expected to show that inflationary pressures eased modestly but also remained above the Federal Reserve’s 2% target.

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.

Solana Price Forecast: Mixed market sentiment caps recovery

Solana (SOL) is trading at $79 as of Friday, following a correction of over 9% so far this week. On-chain and derivatives data indicates mixed sentiment among traders, further limiting the chances of a price recovery.