EUR/USD outlook: Fresh bears are pausing above strong supports and awaiting signal

Slobodan Drvenica Windsor Brokers

EUR/USD

The Euro extended weakness on Friday, following strong upside rejection and subsequent fall, driven by risk aversion on Thursday.
Fresh bears face headwinds at 1.1268/57 zone (converged 10/20/30DMA) and pausing here in early European trading, but technical signals continue to point lower.
Thursday's bull-trap above 1.1362 Fibo barrier (76.4%) and bearish daily candle with long upper shadow weighs, along with south-heading daily momentum and stochastic, however, fundamentals are expected to continue to heavily influence risk sentiment and define near-term direction. Bearish scenario requires break and close below 1.1268/57 pivots to further weaken near-term structure and expose lower targets at 1.1220/00. Conversely, cautious longs for possible renewed attack at cracked 1.1362 Fibo barrier could be favored while 1.1268/57 supports hold.

Res: 1.1295; 1.1325; 1.1348; 1.1370
Sup: 1.1265; 1.1254; 1.1220; 1.1200

Interested in EUR/USD technicals? Check out the key levels

1. R3 1.1434
2. R2 1.1402
3. R1 1.1344
PP 1.1312
1. S1 1.1253
2. S2 1.1222
3. S3 1.1163

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD stays below 1.1850 after dismal German sentiment data

EUR/USD stays in negative territory below 1.1850 in the second half of the day on Tuesday. Renewed US Dollar strength, combined with a softer risk tone keep the pair undermined alongside downbeat German ZEW sentiment readings for February.

GBP/USD falls toward 1.3550, pressured by weak UK jobs report

GBP/USD remains under bearish pressure and extends its decline below 1.3600 on Tuesday. The United Kingdom employment data suggested worsening labor market conditions, bolstering bets for a BoE interest rate cut next month and making it difficult for Pound Sterling to stay resilient against its peers.

Gold recovers modestly, stays deep in red below $4,950

Gold (XAU/USD) stages a rebound but remains deep in negative territory below $4,950 after touching its weakest level in over a week near $4,850 earlier in the day. Renewed US Dollar strength makes it difficult for XAU/USD to gather recovery momentum despite the risk-averse market atmosphere.

Canada CPI expected to show sticky inflation in January, still above BoC’s target

Economists see the headline CPI rising by 2.4% in a year to January, still above the BoC’s target and matching December’s increase. On a monthly basis, prices are expected to rise by 0.1%.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Stellar mixed sentiment caps recovery

Stellar price remains under pressure, trading at $0.170 on Tuesday after failing to close above the key resistance on Sunday. The derivatives metric supports the bearish sentiment, with XLM’s short bets rising among traders and funding rates turning negative.