EUR/USD Current price: 1.0878
- The looming US presidential election undermines demand for the US Dollar.
- Higher-than-anticipated United States inflation data pushed EUR/USD further up.
- EUR/USD positive momentum is set to continue in the near term.
The EUR/USD pair maintains a positive tone on Thursday, trading near a weekly high in the 1.0880 region. The US Dollar remains on the back foot despite the sour tone of global equities, still affected by mixed data released on Wednesday as the United States (US) heads to the polls to choose the next president. Americans have to decide whether former President Donald Trump or current Vice President Kamala Harris will become the 47th president of the world’s largest economy.
Data-wise, Germany released September Retail Sales, which rose by 1.2% from the previous month and 3.8% year-on-year (YoY), much better than the -0.5% and 1.6% expected. Additionally, the Eurozone published the preliminary estimate of the October Harmonized Index of Consumer Prices (HICP), which increased 2% YoY, higher than the previous 1.7% and above the 1.9% expected. The core annual HICP held at 2.7%, against expectations of a down-tick to 2.6%.
The US published Initial Jobless Claims for the week ended October 25, which came in better than anticipated, falling to 216K from a revised 228K in the previous week. The country also released the September Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s (Fed) favorite inflation gauge. PCE inflation was up 2.1% YoY and 0.2% MoM, as expected, while the core annual reading hit 2.7%, higher than the 2.6% anticipated by market participants.
The news put pressure on the US Dollar and pushed it lower against most major rivals, sending EUR/USD closer to the 1.0900 level.
EUR/USD short-term technical outlook
The daily chart for the EUR/USD pair shows it’s currently overcoming its 20 and 200 Simple Moving Averages (SMAs) with the shorter one maintaining its bearish slope and about to cross below the longer one. Technical indicators, in the meantime, grind higher with modest strength but remain below their midlines, suggesting buyers hesitate. Finally, the pair is above the 23.6% Fibonacci retracement of the 1.1208 - 1.0760 decline at 1.0865, the immediate support level.
In the near term, and according to the 4-hour chart, the risk skews to the upside. EUR/USD develops above its 20 and 100 SMAs, with the shorter one gaining upward traction below the longer one. At the same time, technical indicators head firmly north within positive levels, in line with the ongoing advance and a potential bullish extension, particularly if EUR/USD reconquers the 1.0900 mark.
Support levels: 1.0865 1.0820 1.0770
Resistance levels: 1.0900 1.0940 1.0985
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 struggles near multi-month low below 0.6500 after Aussie jobs report
AUD/USD hangs near its lowest level since August 6 below the 0.6500 level following the release of rather unimpressive Australian employment details for October. Meanwhile, RBA Governor Michele Bullock said earlier on that interest rates were restrictive enough and will not rise any further.
USD/JPY briefly pops 156.00 on firmer US Dollar
USD/JPY holds firm near its highest level since July 24, having briefly popped 156.00 in the Asian session on Thursday. The continuation of the Trump trade lifts the US Dollar to yearly highs while Japan's stimulus plans fail to inspire the Yen. Traders watch out for any Japanese internvetion risks.
Gold downside appears unabated, with eyes on Fed Chair Powell
Gold price is sitting at its lowest level in two months near $2,560 early Thursday, as buyers eagerly await US Federal Reserve Jerome Powell’s speech for a brief respite.
XRP's open interest drops over 10% amid struggles near $0.7440 resistance
Ripple's XRP is trading near $0.6900, down nearly 3% on Wednesday, as declining open interest could extend its price correction. However, other on-chain metrics point to a long-term bullish setup.
Trump vs CPI
US CPI for October was exactly in line with expectations. The headline rate of CPI rose to 2.6% YoY from 2.4% YoY in September. The core rate remained steady at 3.3%. The detail of the report shows that the shelter index rose by 0.4% on the month, which accounted for 50% of the increase in all items on a monthly basis.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.