EUR/USD Forecast: Retreating from highs but still bullish

Valeria Bednarik FXStreet

EUR/USD Current Price: 1.2027

The American currency recovers modestly following the sour tone of equities.
A scarce macroeconomic calendar leaves currency pairs in the hands of sentiment.
EUR/USD corrects overbought conditions but holds well above 1.2000.

The EUR/USD pair extended its advance to 1.2079, a fresh one-month high, retreating afterwards but holding on to substantial weekly gains in the 1.2040 price zone. The sour tone of Asian and European equities, sharply down after Monday’s gains, paused the dollar’s decline and helped it bounce modestly. Nevertheless, it remains the weakest currency across the FX board.

The macroeconomic calendar has little to offer this Tuesday. Germany published the March Producer Price Index, which surprised to the upside by printing at 0.9% MoM and 3.7% YoY. The US macroeconomic calendar has nothing relevant to offer today.

EUR/USD short-term technical outlook

The EUR/USD pair eases ahead of the US opening but has limited bearish potential. The 4-hour chart shows that the pair is developing well above a bullish 20 SMA, while the longer moving averages slowly turn higher, far below the shorter one. Technical indicators are retreating from overbought readings but remain well into positive levels. A corrective decline could be triggered on a break below 1.2015, the immediate support.

Support levels: 1.2015 1.1980 1.1940

Resistance levels: 1.2085 1.2130 1.2170

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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