EUR/USD: turning neutral short term, Wall Street will set the tone

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1804

A stronger dollar leads the way, although the pair refuses to break lower
US housing data and Wall Street to define direction into next week

The EUR/USD pair hovers above 1.1800, with little life of its own this Friday, as it holds within Thursday's range, although trading lower, as a continued rally in US equities helps the greenback. The pair is down some 60 pips from its daily high purely on dollar's demand, as macroeconomic data released so far was generally positive for the common currency. In Germany, the Producer Price Index rose by 0.3% on a monthly basis, and by 3.1% when compared to a year earlier, both beating market's forecast in September. The EU current account for August posted a larger-than-expected surplus of €33.3 billion while July's figure was revised to 31.5B from a previous estimate of 25.1B. Ahead of the release of US existing home sales figures, the dollar maintains its poise, although equities are poised to open modestly lower.

As for the technical picture, the 4 hours chart shows that the price continues hovering around the 38.2% retracement of its latest bullish run, and between the 100 and 200 moving averages, while the Momentum indicator has lost its bearish strength, now aiming to regain the upside within positive territory as the RSI turned flat around 50, offering a short-term neutral stance. As mentioned in previous updates, the immediate support comes at 1.1770, the 50% retracement of the same rally, and where it bottomed on Thursday, being the level to break to confirm a new leg lower, targeting then the 1.1720/30 region. The 1.1820/30 price zone, on the other hand, is the immediate resistance, followed by the 1.1860 price zone.

Support levels: 1.1770 1.1720 1.1690

Resistance levels: 1.1840 1.1880 1.1920

View Live Chart for the EUR/USD

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.

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