EUR/USD Forecast: Limited bullish scope

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.0884

Investors remain cautiously optimistic ahead of economic re-openings.
The US to publish May’s Consumer Confidence seen plummeting to 88.
EUR/USD bullish, although unlikely to leave its latest range.

The EUR/USD pair is trading higher this Tuesday, although within familiar levels. The daily high so far has been 1.0888, with selling interest still aligned ahead of the 1.0900 level. The advance is being attributed to resurgent risk-appetite weighing on the greenback. The dollar is down against all of its major rivals as high-yielding stocks run higher, amid hopes economies will start to lift lockdowns. The pandemic curves have continued to flatten in most Europe, although the US is not out of the woods. Anyway, several countries are announcing re-openings as fears of a recession weigh more.

The EU didn’t publish relevant macroeconomic data, while the US has just released its March Goods Trade Balance, which posted a deficit of $64.22B, worse than the $-62.67B expected, and Wholesale Inventories for the same month, which came in at -1.0% beating the market’s expectations. Later today, the country will release the Richmond Fed Manufacturing Index for April, foreseen at -6, and more relevant the CB Consumer Confidence Index, foreseen in May at 88 against 120 in April.

EUR/USD short-term technical outlook

The EUR/USD pair has broken above a daily descendant trend line, holding above it ahead of the US opening, and bullish in the short term, although it would need to clear the 1.0920 resistance level to keep rallying today. In the 4-hour chart, the pair is above its 20 and 100 SMA, which have turned flat, but still below a bearish 200 SMA. Technical indicators, in the meantime, maintain their strong bullish momentum within positive levels, skewing the risk to the upside.

Support levels: 1.0830 1.0795 1.0760

Resistance levels: 1.0890 1.0920 1.0950

View Live Chart for the EUR/USD

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.

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