EUR/USD holding 100-DMA support, US GDP to provide further cues

Haresh Menghani FXStreet

The EUR/USD pair remained on back-foot but has managed to hold its neck above 100-day SMA support and is currently trading at 1.1180 level as market now awaits for fresh impetus from US GDP print.

The pair on Thursday did attempt to move back above 1.1200 handle on an underlying weakness from durable-goods data released on Thursday. The pair, however, trimmed its gains from higher levels as Fed Governor Jerome Powell echoed hawkish tone and pointed that an immediate interest rate-hike remains on cards on signs of a sustained economic recovery.

On Friday, the EUR/USD pair held in a tight range as investors wait for the revised reading of the first quarter GDP reading from the US, later during NA session. Investors also seemed reluctant to carry big bets ahead of the weekend, preceding next week's critical NFP release. Next week's NFP release would be the last major macro release from the US ahead of the crucial Federal Reserve's monetary policy meeting in June.

Investors will also scrutinize the Federal Reserve chairwoman Janet Yellen's speech later on Friday when she speaks at Harvard University.

Technical outlook

A team of analysts at XM Investment Research notes, "RSI is still in bearish territory below 50 and a significant shift in upside momentum would be needed to propel prices to break above 1.12 to rise towards this week’s high of 1.1243 and then target the 1.13 round figure resistance."

"Alternatively, if the market remains below 1.1200, it would appear that the recent bounce was just a correction of the downtrend that started from 1.1615. Prices would resume the downtrend to fall towards 1.1067, the 50% Fibonacci level."

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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