EUR/USD Forecast: When will bulls realize their potential? A lot depends on the data

EUR/USD is trading in the upper end of familiar ranges.
Markets are calmer after the major events of the week, but two more data points are due.
The technical picture is bullish for the pair.

Yohay Elam FXStreet

EUR/USD is trading below 1.1300, kicking off this European session in a similar state to the previous days. The dovish stance from the ECB and the FOMC Minutes has been digested by markets, and so is the Brexit delay.

Fed officials spoke on Thursday and repeated the message of patience regarding the next moves in interest rates. James Bullard of the Saint Louis Fed went further and said that the normalization process has ended - no more rate hikes. However, Bullard is a known dove: others do not share his views.

According to US media, Herman Cain, Trump's nominee for the Fed, will drop out after several Republicans said they would vote against him. Cain adopted Trump's stance regarding cutting rates. The other candidate, Stephen Moore, remains on course.

US data was positive on Thursday: the Producer Price Index rose by 0.6% MoM and Core PPI by 0.3%, both exceeding expectations. Weekly jobless claims hit a fresh near 50-year low with 196K. The upbeat data pushed EUR/USD lower, but the pair drifted back up.

There are still two significant publications left for the last day of the week. Euro-zone industrial output is set to drop in the report for February, serving as a reminder for the old continent's slowdown.

In the US, the focus is on the Consumer Sentiment Index from the University of Michigan. A similar score to March's 98.4 points is forecast in the preliminary read for April. This is a relatively upbeat figure.

See: Michigan Consumer Sentiment Index Preview: Regaining trend

All in all, fundamentals to gains for the dollar against the euro, but technicals tell a different story.

EUR/USD Technical Analysis

EUR/USD is flirting with the 200 Simple Moving Average on the four-hour chart. If the break is confirmed, there is more room to the upside. Momentum remains positive and the Relative Strength Index is also high. All in all, the technical picture is bullish for the pair.

Immediate resistance is at the recent two-week high of 1.1295. Further above, 1.1330 capped the pair in late March. It is followed by the stubborn resistance line of 1.1360 dating from mid-March. 1.1390 is next.

The first support is at 1.1250 which provided support early in the day and held it down earlier in the month. 1.1210 prevented further falls in early April and also in late March. The 2019 trough fo 1.1176 is next down the line.

More: EUR/USD path of least resistance is up, but can it rise?– Confluence Detector

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

EUR/USD struggles near 1.1850, with all eyes on US CPI data

EUR/USD holds losses while keeping its range near 1.1850 in European trading on Friday. A broadly cautious market environment paired with a steady US Dollar undermines the pair ahead of the critical US CPI data. Meanwhile, the Eurozone Q4 GDP second estimate has little to no impact on the Euro.

GBP/USD recovers above 1.3600, awaits US CPI for fresh impetus

GBP/USD recovers some ground above 1.3600 in the European session on Friday, though it lacks bullish conviction. The US Dollar remains supported amid a softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold remains below $5,000 as US inflation report looms

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains in the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

US CPI data set to show modest inflation cooling as markets price in a more hawkish Fed

The US Bureau of Labor Statistics will publish January’s Consumer Price Index data on Friday, delayed by the brief and partial United States government shutdown. The report is expected to show that inflationary pressures eased modestly but also remained above the Federal Reserve’s 2% target.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Solana Price Forecast: Mixed market sentiment caps recovery

Solana (SOL) is trading at $79 as of Friday, following a correction of over 9% so far this week. On-chain and derivatives data indicates mixed sentiment among traders, further limiting the chances of a price recovery.