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EUR/USD cautiously cheers hawkish ECB bias above 1.0700, German Factory Orders, EU Retail Sales eyed

  • EUR/USD picks up bids to extend week-start rebound, struggles to keep buyers hopeful of late.
  • Recently weak risk catalysts weigh on Euro pair but downbeat US data defends buyers.
  • Second-tier German, European statistics eyed for clear directions as ECB hawks fail to impress EUR/USD bulls.

EUR/USD grinds higher past 1.0700, mildly bid near 1.0715, as it struggles to cheer the broad US Dollar pullback, as well as the hawkish European Central Bank (ECB) concerns ahead of the mid-tier EU data on early Tuesday.

That said, the EUR/USD pair recovered from the weekly low on Monday amid downbeat US data versus hawkish ECB talks.

While portraying the same, US ISM Services PMI declined to 50.3 for May versus 51.5 expected and 51.9 prior whereas growth of the Factory Orders also deteriorated during the stated month to 0.4% versus 0.5% market forecasts and 0.9% previous readings. It should be noted that the final readings of S&P Global Composite PMI and Services PMI also marked softer figures for May.

On the contrary, Eurozone Sentix Investor Confidence dropped to the lowest levels in five months to -17.1 for June versus -9.2 expected and -13.2 prior. It’s worth observing that the same sentiment gauge for Germany dropped to its lowest levels since November 2022, to -21.1 versus -14.5 prior.

Following the data, European Central Bank (ECB) President Christine Lagarde reiterated that price pressure remains strong in the Euro area. The policymaker also stated that no clear evidence that underlying inflation has peaked.

With this, the market’s bets on the Fed’s June rate hike dropped from around 80% in the middle of the last week to nearly 25%. The same could have joined an absence of the Fed talks to weigh on the US Treasury bond yields and the US Dollar. However, hawkish comments from International Monetary Fund (IMF) Managing Director Kristalina Georgieva and concerns about the need for the US large banks to hold more capital to battle the landing crisis prod the EUR/USD bears.

Against this backdrop, Wall Street closed in the red whereas S&P500 Futures print mild losses by the press time.

Looking ahead, EUR/USD traders should pay attention to the risk catalysts for clear directions. That said, monthly prints of German Factory Orders and Eurozone Retail Sales for April could entertain intraday buyers of the Euro pair amid hopes of upbeat statistics from the old continent.

That said, forecasts suggest improvement in German and Eurozone figures, which in turn push back the dovish ECB concerns. The same allows the ECB hawks to retake control and propel the EUR/USD price.

Technical analysis

EUR/USD grinds between the 100-EMA and 200-EMA, respectively between 1.0770 and 1.0690, amid a looming bull cross on the MACD and upbeat RSI suggesting the Euro pair’s further recovery.

Additional important levels

Overview
Today last price1.0716
Today Daily Change0.0003
Today Daily Change %0.03%
Today daily open1.0713
 
Trends
Daily SMA201.0798
Daily SMA501.0895
Daily SMA1001.0812
Daily SMA2001.0505
 
Levels
Previous Daily High1.0722
Previous Daily Low1.0675
Previous Weekly High1.0779
Previous Weekly Low1.0635
Previous Monthly High1.1092
Previous Monthly Low1.0635
Daily Fibonacci 38.2%1.0704
Daily Fibonacci 61.8%1.0693
Daily Pivot Point S11.0684
Daily Pivot Point S21.0656
Daily Pivot Point S31.0637
Daily Pivot Point R11.0732
Daily Pivot Point R21.0751
Daily Pivot Point R31.078

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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