- Bounces on fresh DXY selling.
- Back above 50-DMA barriers at 1.1750.
- Eurozone final CPI, US tax reforms in focus.
Fresh bids emerged for the EUR/USD pair near 1.1740 levels in early trades, which prompted a bounce back above the 50-DMA support-turned-resistance at 1.1750, as the bulls fight back control kicking-off a brand new week.
EUR/USD: Will it sustain the bounce?
Amidst broad-based US dollar weakness ahead of the US tax reform votes, the main currency pair caught a fresh bid and paused its two consecutive days of declines, now making headways towards the 1.18 handle ahead of the Eurozone final CPI figures due later in the European session. The Eurozone final CPI is expected to confirm a 1.5% reading, the seen in the prelim release.
The Euro also continues to derive some support from the upward revisions made to its growth projections by the ECB last week, while solid Eurozone fundamentals, including a raft of solid manufacturing PMI reports, also helps underpin the sentiment around the spot.
More so, Friday’s US CFTC commitment of traders’ report that showed the EUR net longs increased to the highest levels since May 2007, also lifts the sentiment around the common currency so far this session. The EUR longs increased in the current week to 114K - a change of 21k.
Looking ahead, it remains to be seen whether the major can sustain the latest upmove, in the wake of the US political developments surrounding the tax reforms and ahead of the key US macro news, including the final GDP and durable goods data.
EUR/USD Technical Outlook
Valeria Bednarik, Chief Analyst at FXStreet, explains: “Shorter term, and according to the 4 hours chart, the risk has also turned toward the downside, as the pair settled below all of its moving averages, while the Momentum indicator entered bearish territory as the RSI indicator heads south around 42. The pair has a major support around 1.1715, where it bottomed twice in the last four weeks. Support levels: 1.1715 1.1660 1.1620. Resistance levels: 1.1770 1.1830 1.1870.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD breaks below 1.1000 on stellar NFP
The buying bias in the Greenback gathers extra pace on Friday after the US economy created far more jobs than initially estimated in September, dragging EUR/USD to the area of new lows near 1.0950.
GBP/USD breaches 1.3100 after encouraging US Payrolls
The continuation of the uptrend in the US Dollar motivates GBP/USD to accelerates its losses and breaches 1.3100 the figure in the wake of the release of US NFP.
Gold rebounds from daily lows and flirts with $2,670
Following a post-NFP dip to the $2,640 region, Gold prices now embarks on an acceptable rebound and retest the area of $2,670 per ounce troy despite the marked advance in the US Dollar and rising US yields across the board.
US Payrolls surge in September, as 50bp rate cut ruled out
US payrolls data surprised on the upside in September, rising by 254k, smashing expectations of a 150k rise. The unemployment rate fell to 4.1% from 4.2%, average hourly earnings increased to a 4% YoY rate and there was a 72k upwards revision to the previous two months’ payrolls numbers.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.