• EUR/USD stays bid and climbs to one-week tops amid sustained USD selling.
  • The Fed's unlimited QE, $2 trillion US stimulus package weighed on the USD.
  • Thursday's key focus will be on the US macro data – jobless claims and Q4 GDP.

Following the previous session's intraday pullback, the EUR/USD pair caught some fresh bids on Wednesday and built on its recent recovery move from multi-year lows. Persistent offered bias around the US dollar, all against the backdrop of the Fed's unlimited QE, was seen as one of the key factors driving the pair higher. Investors further took comfort from the passage of a massive $2 trillion US stimulus package to offset the economic impact from the coronavirus pandemic and continued dumping the greenback.

Meanwhile, the positive momentum seemed rather unaffected by awful German IFO Business Climate, which slumped to 86.1 in February – the lowest value since July 2009. Adding to this, IFO President Clemens Fuest noted in a statement that the German economy could shrink by as much as 20% in 2020, albeit did little to dampen the positive mood surrounding the major. Across the pond, the mixed US Durable Goods Orders data failed to provide any respite to the USD bulls or hinder the pair's intraday move up.

The continued gaining traction for the fifth consecutive session on Thursday and climbed further beyond the 1.0900 round-figure mark, hitting one-week tops during the Asian session. It, however, remains to be seen if bulls are able to capitalize on the momentum or the pair's meets with some fresh supply at higher levels. The fact that the coronavirus continues spreading exponentially, in Europe and the US, concerns over the economic fallout/imminent global recession might extend some support to the greenback's status as the global reserve currency and keep a lid on any runaway rally for the major.

On Thursday, the European Central Bank is scheduled to release the monthly Economic Bulletin. The key focus, however, will be on the US initial weekly jobless claims for the week ended March 20. Economists are looking for claims to soar to 1,000K as compared to the previous week's reading of 281K. The US economic docket also features the release of the final GDP print, which is expected to confirm that the economic growth stood at 2.1% annualized pace during the final quarter of 2019 and might fail to provide any meaningful impetus.

Short-term technical outlook

From a technical perspective, the overnight sustained move above the 23.6% Fibonacci level of the 1.1497-1.0636 recent slump supports prospects for additional gains. However, any subsequent positive move is likely to confront a stiff resistance near the 1.0965-70 region, marking 38.2% Fibo. level. This is closely followed by 50-day SMA, just ahead of the key 1.10 psychological mark, which should now act as a key pivotal point for short-term traders. Above the mentioned barrier, the pair is likely to accelerate the momentum further towards 50% Fibo. level, around the 1.1060-65 region.

On the flip side, immediate support is now pegged near the 1.0875 horizontal zone ahead of the 1.0840 level (23.6% Fibo.). Failure to defend the said support levels might offset the near-term positive outlook, rather prompt some technical selling and drag the pair back towards the 1.0800 round-figure mark. Some follow-through selling might now turn the pair vulnerable to resume its prior bearish trend and head back towards challenging sub-1.0700 levels with some intermediate support near the overnight swing low, around the 1.0760 region.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex Analysis

Editors’ Picks

AUD/USD remains under pressure below 0.6100 as markets stay defensive

AUD/USD fails to cheer better than forecast activity numbers from home and China. Globally rising coronavirus cases, extended lockdowns in Europe and grim words from key policymakers favor risk-off. 


USD/JPY seesaws around 107.00 amid coronavirus-led risk-off

USD/JPY remains on the back foot amid the early Thursday morning in Asia. The Japanese yen benefits from its safe-haven allure while being the only major to gain versus the US dollar during the current tough time.


Gold building a bullish case as COVID-19 reigns

The gold price has lost some bullish support of late as the US dollar moves higher, ending the last quarter on the front foot as a relatively illiquid market sees exaggerated moves adding to the upside support. 

Gold News

WTI pierces $21.00 as US fuels hopes of supply disturbance/control

While extending its recovery moves from the previous day, WTI clears the $21.00 mark, with a high of $21.20, while taking rounds to $21.10 during Thursday’s Asian session. The US leader expects Russia-Saudi Arabia “to work it out.”

Oil News

Dollar Shrugs Off ISM & ADP in Fear of Ugly Jobless Claims

If the first day of April is a taste of what's to come, it will be a very rocky second quarter. After falling more than 24% between January and March, the Dow Jones Industrial Average plunged opened down more than -700 points. 

Read more

Forex Majors