EUR/USD Price Forecast: Modest advance as thin trading continues

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0452

ECB Governing Council member Knot commented on potential benefits of Chinese trade.
The United States will publish some minor macroeconomic figures after the opening.
EUR/USD advances in thin trading conditions, faces resistance at around 1.0470.

The EUR/USD pair posts a modest intraday advance on Monday, reverting an early slide towards the 1.0400 region. The US Dollar (USD) found near-term demand during Asian trading hours, albeit persistent thin holiday trading limited directional moves across financial boards. The USD, however, shed ground in European trading hours, helping EUR/USD recover towards the current 1.0450 price zone.

Meanwhile, European Central Bank (ECB) Governing Council member Klaas Knot hit the wires and noted that “there is a chance that the Chinese will start offering their goods in Europe at lower and lower prices” if the upcoming United States (US) administration goes ahead with imposing fresh tariffs on Chinese products.

The macroeconomic calendar offered no relevant data, although Spain reported that the Harmonized Index of Consumer Prices (HICP) unexpectedly rose to 2.8% on a yearly basis in December, according to preliminary estimates.

The US will release, after Wall Street’s opening, the December Chicago Purchasing Managers’ Index and the Dallas Fed Manufacturing Business Index for the same month. The country will also publish November Pending Home Sales. Ahead of the opening, US indexes trade with a soft tone, although holding within familiar levels and above Friday’s lows.

EUR/USD short-term technical outlook

From a technical point of view, the EUR/USD pair is up for a third consecutive day yet still at risk of falling. In the daily chart, the pair keeps developing below all its moving averages, with the 20 Simple Moving Average (SMA) providing dynamic resistance at around 1.0470. Technical indicators, in the meantime, have posted modest advances but remain within negative levels and far from suggesting a relevant leg north.

In the near term, and according to the 4-hour chart, on the contrary, technical readings suggest the pair may add some pips. A mildly bullish 20 SMA provides intraday support around the 1.0400 threshold, although the 100 and 200 SMAs maintain their bearish slopes above the current level. Finally, technical indicators extend their advances within positive levels, reflecting near-term buying interest. The upward momentum, however, remains limited.

Support levels: 1.0400 1.0370 1.0330

Resistance levels: 1.0470 1.0510 1.0550

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

GBP/USD hits multi-week tops around 1.3560

GBP/USD gathers fresh steam and advances to new three-month peaks near the 1.3560 zone on Friday. Cable’s sharp move higher comes after three daily drops in a row and follows the increasing selling pressure hurting the Greenback.

EUR/USD pops to fresh two-month highs, targets 1.1600

EUR/USD advances markedly, revisiting the upper 1.1500s for the first time since mid-June. The pair’s sharp uptick comes on the back of a strong retracement in the US Dollar amid BoJ intervention chatter and despite steady uncertainty in the Middle East.

Gold picks up pace, approaches $4,400

Gold rebounds toward the $4,400 mark per troy ounce on Friday, reversing the previous day’s pullback. The precious metal’s recovery comes as fresh and intense weakness keep weighing on the US Dollar, while traders keep assessing easing expectations of an imminent Fed interest rate hike and the situation from the Middle East.

Pi Network Price Forecast: PI extends consolidation as bulls eye $0.10

Pi Network (PI) price holds steady on Friday, maintaining a consolidating tone for three consecutive days. Mild retail strength in the PI token remains stable, with Open Interest above $9 million, while social buzz eases. PI token’s technical outlook is mixed, as bearish momentum wanes to neutral, with bulls eyeing the $0.1000 psychological level.

Weekly focus: Some relief in US inflation concerns

Actual inflation data for July came out as expected with a 0.1% m/m increase in headline CPI and 0.2% excluding food and energy. Annual headline inflation remains too high at 3.4% and means that wage earners are experiencing stagnating spending power at best, and core inflation is a bit higher than the inflation target of two percent would suggest.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.