EUR/USD Current price: 1.1189
- European data resulted encouraging, but had no impact on the Euro.
- United States inflationary pressures at wholesale levels eased in April.
- EUR/USD holds within range, risk skews to the downside in the near term.
The EUR/USD pair hovers around the 1.1200 level on Thursday, confined to a tight intraday range. The pair peaked at 1.1227 during Asian trading hours, but retreated towards its intraday low ahead of the American opening amid a souring market mood.
Stocks turned south, helped by headlines coming from Japan, indicating the United States (US) is considering the possibility of revising the trade agreement with Japan in tariff talks. Seems the US is asking for additional concessions on agriculture and livestock products, something Japan is unwilling to grant, risking a deadlock in negotiations.
Other than that, a packed macroeconomic calendar had a limited impact on the pair. The Eurozone (EU) published March Industrial Production, which rose by 2.6% on a yearly basis, improving from the previous 1.1% and beating the 1.8% expected. Across the pond, the US published Initial Jobless Claims, which rose by 229K in the week ended May 10, matching expectations. Additionally, the April Producer Price Index (PPI) fell by 0.5% in the month, while the annual figure came in at 2.4%, both below expectations and March levels. Finally, US Retail Sales were up 0.1% in April, slightly better than the 0% anticipated by market participants.
EUR/USD short-term technical outlook
The EUR/USD pair ticked higher following US data releases, yet quickly retreated towards the 1.1190 area. Technical readings in the daily chart show it keeps developing below a bearish 20 Simple Moving Average (SMA), providing dynamic resistance at around 1.1310. At the same time, technical indicators remain right below their midlines without clear directional strength, in line with the absence of buying interest.
In the near term, there’s an increased downward risk. The EUR/USD pair develops below the 100 and 200 SMAs, while a mildly bearish 20 SMA stands at 1.1160. Finally, technical indicators turned south, yet hold within positive levels. A break below the mentioned 1.1160 region could open the door for a bearish extension, yet a steeper decline remains out of the picture.
Support levels: 1.1160 1.1120 1.1075
Resistance levels: 1.1265 1.1310 1.1350
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