EUR/USD Forecast: The thrill is gone and looking vulnerable ahead of critical data

  • EUR/USD is trading around 1.1200, back at the previous range. 
  • The trade front is calm, and critical data is eyed. 
  • The technical outlook is not bullish anymore for the pair.

Calm is not necessarily a good thing for EUR/USD. The rhetoric around the US-China trade war has softened, US Treasury Secretary Steven Mnuchin is set to fly to Beijing for more talks, and stock markets are more stable. However, as time passes by, the new US tariffs are set to take their toll and additional ones are prepared.

In China, retail sales, industrial output, and foreign investment numbers all disappointed. Nevertheless, markets expect the Chinese authorities to provide stimulus measures. US President Donald Trump noted China's efforts and said that the Fed should cut interest rates as well. This may not happen so fast.

And while bond markets foresee a growing chance of the Federal Reserve slashing rates this year, New York Fed President John Williams pointed to the inflationary effect that these duties have. And that may imply the Fed raising rates to battle rising prices. 

In the meantime, Germany has reported a return to growth in the first quarter of the year: 0.4%, as expected. Euro-zone GDP is projected to be confirmed at 0.4% after the news from the largest economy. 

The most substantial US figure is due later today: retail sales for April. Consumers were out and about in March with sales volume rising sharply. More moderate figures are projected for April. These low expectations may result in an upside surprise, that could send the greenback higher.

See US Retail Sales Preview: Labor Market Rules

Overall, trade developments and tweets from Trump remain in the limelight, but the top-tier US publication will have its say as well.

EUR/USD Technical Analysis

EUR USD technical analysis May 15 2019

EUR/USD has lost its upside momentum and the 100 Simple Moving Average on the four-hour chart. It is currently struggling with the 50 SMA. The Relative Strength Index has also dropped from the highs. All in all, the bulls have retreated.

Initial support awaits at the round number of 1.1200 which supported the currency pair earlier today and the price also coincides with the 200 SMA. 1.1175 was a swing low last week, and it is followed by 1.1135 which was the low point in May. The 2019 trough of 1.1110 is the next level to watch.

EUR/USD is battling 1.1220 that capped it last week and provided some support this week. Next up, 1.1250 was a swing high last week and 1.1265 is a triple top, holding EUR/USD down in late April, early May, and also in mid-May.

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 Analysis

Latest Forex Analysis

Editors’ Picks

GBP/USD: Bears eye 1.25 as disappointing UK GDP knocks off yields

GBP/USD extends losses towards 1.2500, as the UK GDP disappointment weighs negatively on the 2-year Gilt yields. Broad US dollar strength amid risk-off mood also adds to the bearish pressure on the cable. 


EUR/USD under pressure below 1.1350 amid risk-aversion

EUR/USD remains pressured below 1.1350, as US dollar trades firmer amid broad risk-aversion. The German ZEW Survey to show signs of an economic turnaround. Heightened expectations for an EU fiscal stimulus plan could buoy the shared currency. 


Gold: $1796 is the level to beat for the XAU bears

Gold is trying hard to recover ground above the $1800 mark, as the US dollar continues to benefit from broad risk-aversion amid looming coronavirus risks. Let’s see how it is positioned ahead of the critical US CPI release.

Gold News

Forex Today: US dollar seizes control as risk aversion returns, a busy docket ahead

Broad US dollar strength extended into Asia, as risk-averse market conditions persisted amid intensifying coronavirus fears and US-China tensions. The Asian equities followed the late sell-off on Wall Street while the US stock futures struggled with its recovery.

Read more

WTI recovers from intraday low under $40.00 ahead of API inventories

WTI’s pullback from $39.30 fails to defy a two-day losing streak. China’s sustained increase in oil imports confronts chatter of easing output cuts. US inflation data, API stockpiles and American earnings are in the spotlight.

Oil News

Forex Majors