EUR/USD Forecast: Near April’s high but lacking momentum

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.1902

EU Retail Sales beat expectations, surging by 3% MoM in February.
US Treasury yields ticked higher after auctions but fell short of boosting the greenback.
EUR/USD holds near monthly highs but lacks enough directional strength.

The American dollar ended the day down against most major rivals this Monday, after a positive start to the week. The EUR/USD pair ends the day at the upper end of its daily range, a handful of pips above the 1.1900 figure. The risk-related sentiment led the way, with currencies following the lead of stocks. Equities started the week on a negative footing, although European indexes closed away from daily lows while US ones posted modest losses, limiting demand for the American currency.

In general, investors maintained a cautious stance ahead of the next relevant catalyst after US Federal Reserve head Jerome Powell cooled expectations for higher inflation in the US. Data wise, the EU published February Retail Sales, which were up by 3% MoM, and down 2.9% YoY, beating the market’s expectations. The US macroeconomic calendar had nothing to offer.

On Tuesday, Germany will publish the April ZEW survey with the Economic Sentiment in the country is foreseen at 79.5 and the EU one at 73.2. The US will publish March CPI data, with the annual core inflation foreseen at 0.2%.

EUR/USD short-term technical outlook

The EUR/USD pair is neutral-to-bullish, trading near the April monthly high at 1.1927. The 4-hour chart shows that the pair is consolidating a few pips above a mildly bearish 200 SMA, while the 20 SMA loses its bullish strength below it. The RSI indicator consolidated around 63 while the Momentum indicator heads marginally lower above its midline. The pair would need to advance above 1.1930 to gain bullish traction and aim for a test of 1.2000.

Support levels: 1.1870 1.1825 1.1785

Resistance levels: 1.1930 1.1965 1.2000

View Live Chart for the EUR/USD

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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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