EUR/USD Price Forecast: Sellers seeking for lower lows

EUR/USD Current price: 1.0377

• Stronger than anticipated, United States data fueled demand for the US Dollar.
• The US will publish the November PCE Price Index on Friday, Fed’s favorite inflation gauge.
• EUR/USD resumed its slide after correcting oversold conditions, fresh lows in sight.

The EUR/USD pair trades around 1.0360 in the mid-American session, retreating from an intraday peak of 1.0421. The US Dollar (USD) shed some ground throughout the first half of the day after reaching extreme overbought conditions following the Federal Reserve's (Fed) monetary policy decision on Wednesday.

The USD, however, recovered its poise ahead of Wall Street’s opening, as upbeat United States (US) macroeconomic data aligned with policymakers’ economic perspective. The country published the Q3 Gross Domestic Product (GDP), which suffered an upward revision. Annualized growth was confirmed at 3.1%, against the 2.8% previously estimated. Meanwhile, Initial Jobless Claims for the week ended December 13 declined to 220K from 242K in the previous week, also beating the expected 230K.

Earlier in the day, the Eurozone released the October Current Account, which posted a seasonally adjusted surplus of €26 billion, missing the expected €33.5 billion.  

On Friday, the US will publish the November Personal Consumption Expenditures (PCE) Price Index, the Fed’s favorite inflation gauge. The report will likely have a limited impact after the latest Fed’s announcement.  The country will also release the December Michigan Consumer Sentiment Index, while the EU will offer the preliminary estimate of December Consumer Confidence.

EUR/USD short-term technical outlook

The EUR/USD pair heads into the Asian opening trading at around 1.0370 and seems poised to extend its slide. The pair is developing below all its moving averages, with the 20 Simple Moving Average (SMA) heading firmly lower at around 1.0500, also below bearish 100 and 200 SMAs. At the same time, technical indicators stand well into negative territory, offering modest downward slopes, reflecting sellers’ dominance.

The bearish case is also clear in the near term. The 4-hour chart shows that technical indicators resumed their slides after correcting extreme oversold readings and hold well below their midlines, albeit with limited directional strength. At the same time, the 20 SMA accelerated lower, extending its slide below the longer ones while above the current level.

Support levels: 1.0330 1.0290 1.0250

Resistance levels: 1.0400 1.0440 1.0485