EUR/USD Price Forecast: Sellers re-take control, aim to retest weekly lows

EUR/USD Current price: 1.0814

• Upbeat European growth-related figures gave a temporal boost to the Euro.
• The US Dollar surged on mixed American data, but the focus remains on the US election’s outcome.
• EUR/USD trimmed early gains and has room to extend its slide below 1.0800.

The EUR/USD pair jumped to 1.0858 during European trading hours, as the Euro found strength in local data. Germany released the preliminary estimate of the Q3 Gross Domestic Product (GDP), which showed that the local economy expanded by 0.2% in the three months to June, recovering from a -0.1% in the previous quarter and beating a similar expected figure.

The Eurozone Q3 preliminary GDP also beat expectations. The economy grew 0.4% on a quarterly basis and 0.9% compared to the third quarter of 2023.

The US Dollar, however, recovered some ground ahead of the next batch of data releases. On the one hand the United States (US) published the ADP report on Employment Change, showing the private sector added  233,000 new positions in October, much better than the 115,000 expected.

But the star of the day was the US Q3 GDP. According to preliminary estimates, the economy grew at an annualized pace of 2.8%, below the 3% expected the previous. The same report showed an uptick in inflation in the three months to June, as the core Personal Consumption Expenditures (PCE) Price Index rose by 2.2%, easing from the previous 2.8% but above the 2.1% expected.

Finally, Germany published the October Harmonized Index of Consumer Prices (HICP). Preliminary estimate inflationary pressures were higher than anticipated, as the monthly HICP rose 0.4%, while the annualized figure posted 2%, up from the previous 1.6% and above the 1.8% anticipated.

The EUR/USD pair showed limited reaction to the latest news as US data was not enough to twist the Federal Reserve’s (Fed) hand, while higher German inflation partially offset encouraging growth-related figures. The focus remains on the US election outcome, with a sour sentiment shaping up early in the American session

EUR/USD short-term technical outlook  

The EUR/USD pair trades around its daily opening and technical readings in the daily chart show the risk remains skewed to the downside. The intraday advance stalled just below a flat 200 Simple Moving Average (SMA), while the 20 SMA is about to cross below it with a sharp downward slope. Technical indicators, in the meantime, lack directional strength but hold below their midlines, in line with absent buying interest.

In the near term, and according to the 4-hour chart, it seems bears are in control. EUR/USD is currently battling a flat 20 SMA, while a bearish 100 SMA provides dynamic resistance at around 1.0865. Technical indicators, in the meantime, have turned sharply higher but remain above their midlines.

Support levels: 1.0795 1.0755 1.0710  

Resistance levels:  1.0865 1.0900 1.0940 

(This story was corrected on October 30 at 15:06 GMT to state the annualized HICP in Germany posted 2.4% in October, up from the previous 1.8% and above the 2.1% anticipated, not 2%, 1.6% and 1.8%, respectively.)