EUR/USD Forecast: Range trading continues post-FOMC Minutes
EUR/USD Current Price: 1.1304
- US data came in worse than anticipated, with unemployment claims up to 207K.
- German inflation soared to 5.3% YoY in December, higher than anticipated.
- EUR/USD maintains its neutral-to-bearish stance seesawing around 1.1300.
The EUR/USD pair bounced from an intraday low of 1.1284 and trades at around 1.1300, as demand for the greenback eased, despite the sour market’s mood persists. The US FOMC Meeting Minutes released Wednesday showed that policymakers are willing to accelerate the pace of tapering, sending the greenback up and stocks down. Asian and European shares remained under pressure after the poor performance of Wall Street.
Data wise, Germany published November Factory Orders, which were up 3.7% MoM, beating expectations. The EU Producer Price Index rose a whopping 23.7% YoY in November, while German inflation was up 5.3% YoY in December. In the US, the November Goods Trade Balance posted a deficit of $-99 billion while weekly unemployment claims rose to 207K in the week ended December 31. The country will publish Factory Orders and the December ISM Services PMI after Wall Street’s opening.
EUR/USD short-term technical outlook
The EUR/USD pair maintains its neutral-to-bearish stance in the near term. The 4-hour chart shows that the price is seesawing around congesting moving averages, all of them confined to a tight 15 pips range. Meanwhile, technical indicators remain directionless around their midlines.
The bullish case could gain strength if the pair breaks above 1.1385, an unlikely scenario at the time being, while bears will have better chances on a break below 1.1220, December monthly low.
Support levels: 1.1260 1.1220 1.1185
Resistance levels: 1.1345 1.1385 1.1410
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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.
