EUR/USD Current price: 1.0281
- The ECB monetary policy meeting accounts were dovish, weighing on the Euro.
- Tepid United States data backed risk aversion and benefits the Greenback.
- EUR/USD could retest the year low on a break below 1.0260.
The EUR/USD pair traded lifeless a handful of pips below the 1.0300 mark on Thursday, as investors see no benefit in adding EUR longs. Tepid European data and a dovish European Central Bank (ECB), keep the upside in check, regardless of recent US Dollar (USD) weakness.
Data-wise, Germany confirmed that the December Harmonized Index of Consumer Prices (HICP) rose by 2.8% year-on-year (YoY), as expected. The index was up 0.7% on a monthly basis, also matching the market forecast.
The ECB released the Minutes of the December meeting, which showed that members were increasingly confident that inflation would return to target in the first half of 2025. However, the document also showed that geopolitical and economic policy uncertainty had become more pronounced since the last governing council meeting, while some members considered a 50 basis points (bps) interest rate cut.
Other than that, the sentiment was mostly optimistic, as investors lifted bets for a Federal Reserve (Fed) interest rate cuts following encouraging inflation figures. Asian shares were up, while most European indexes trade in the green.
As for the United States (US), the country published December Retail Sales, which rose a modest 0.4%, below the 0.6% expected and the previously revised 0.8%. At the same time, the US reported that Initial Jobless Claims for the week ended January 10 increased by 217K, worse than the 210K expected. The poor figures spurred risk aversion, providing the USD with fresh legs.
EUR/USD short-term technical outlook
The EUR/USD pair is bearish, according to technical readings in the daily chart. The pair is currently developing below all its moving averages , with the 20 Simple Moving Average (SMA) providing dynamic resistance at around 1.0340. At the same time, the 100 SMA accelerates south below the 200 SMA, both far above the current level. Finally, technical indicators resumed their slides within negative levels, reflecting increased selling interest.
In the near term, and according to the 4-hour chart, EUR/USD is neutral. A mildly bullish 20 SMA provides support around the current level, while a bearish 100 SMA caps advances 1.0340. Meanwhile, technical indicators turned lower but remain within neutral levels, lacking directional strength. The intraday low at 1.0260 is the immediate support level, followed by the 1.0210 price zone.
Support levels: 1.0260 1.0210 1.0175
Resistance levels: 1.0340 1.0385 1.0410
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
AUD/USD remains depressed below 0.6300 as trade jitters underpin USD
AUD/USD trades with a negative bias below the 0.6300 mark amid a mildly stronger USD, which hit a three-week top during the Asian session. Moreover, worries over Trump's trade tariffs weigh on investors' sentiment and further undermine the risk-sensitive Aussie amid bets that the RBA will cut interest rates again in May.
USD/JPY flat-lined around mid-150.00s; remains close to multi-week high set on Tuesday
USD/JPY struggles to build on the overnight move higher and oscillates around mid-150.00s during the Asian session on Thursday amid mixed cues. Hawkish BoJ expectations and the risk-off impulse, led by Trump's new tariff on imported cars, underpin the safe-haven JPY, capping spot prices.
Gold price sticks to positive bias above $3,000 on safe-haven demand
Gold price ticks higher during the Asian session on Thursday as worries about Trump's tariff plans continue to benefit the safe-haven bullion. However, a modest USD uptick to a three-week high caps the commodity. Traders also seem reluctant and opt to wait for the release of the US PCE Price Index on Friday.
Stablecoin mania kicks off as Wyoming and Fidelity join the race
According to Governor Mark Gordon, the state of Wyoming has joined the race for a stablecoin, following plans to launch WYST, a US Dollar-backed token in July.
Sticky UK services inflation shows signs of tax hike impact
There are tentative signs that the forthcoming rise in employer National Insurance is having an impact on service sector inflation, which came in a tad higher than expected in February. It should still fall back in the second quarter, though, keeping the Bank of England on track for three further rate cuts this year.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.