• EUR/USD bounces off lows near the 0.9800 mark.
  • The dollar now looks offered following the Fed-led rally.
  • ECB-speak, Flash EMU Consumer Confidence next on tap.

Following another test of the 0.9800 neighbourhood, EUR/USD manages to regain some upside traction and advances to the 0.9870 region on Thursday.

EUR/USD looks well supported around 0.9800

EUR/USD partially reverses the weekly leg lower after the Fed-induced pullback forced the pair to retreat to the area last visited back in later October 2002 near the 0.9800 mark on Wednesday and earlier on Thursday.

The daily recovery in spot comes in response to the now renewed selling pressure surrounding the dollar, as investors appear to be cashing up some gains considering the acute uptick in the wake of the Fed’s decision to hike rates at its gathering on Wednesday.

In the euro calendar, the EMU advanced Consumer Confidence gauged by the European Commission will be the only release of note ahead of the ECB General Council Meeting and speeches by Board members E.Fernandez-Bollo, A.Tuominen and I.Schnabel.

In the US docket, Initial Claims and the CB Leading Index will take centre stage later in the NA session.

What to look for around EUR

EUR/USD tumbled to nearly 2-decade lows in the 0.9800 neighbourhood following the equally abrupt move higher in the dollar, particularly exacerbated after the Fed’s move on rates on Wednesday.

So far, price action around the European currency is expected to closely follow dollar dynamics, geopolitical concerns and the Fed-ECB divergence.

On the negatives for the single currency emerge the so far increasing speculation of a potential recession in the region, which looks propped up by dwindling sentiment gauges as well as an incipient slowdown in some fundamentals.

Key events in the euro area this week: Flash Consumer Confidence (Thursday) – EMU, Germany Flash Manufacturing/Services PMI (Friday).

Eminent issues on the back boiler: Continuation of the ECB hiking cycle. Italian elections on September 25. Fragmentation risks amidst the ECB’s normalization of its monetary conditions. Impact of the war in Ukraine and the persistent energy crunch on the region’s growth prospects and inflation outlook.

EUR/USD levels to watch

So far, the pair is advancing 0.38% at 0.9874 and the next up barrier is at 1.0050 (weekly high September 20) followed by 1.0085 (55-day SMA) and finally 1.0197 (monthly high September 12). On the flip side, a breach of 0.9806 (2022 low September 22) would target 0.9685 (October 2002 low) en route to 0.9608 (September 2002 low).

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD drops below 0.9750 after upbeat US PMI data

EUR/USD drops below 0.9750 after upbeat US PMI data

Following a brief consolidation period, EUR/USD came under bearish pressure and dropped below 0.9750 during the American session on Friday. Better than expected Manufacturing and Services PMI figures from the US provided a boost to the dollar, further weighing on the pair.

EUR/USD News

GBP/USD renews multi-decade below 1.0900

GBP/USD renews multi-decade below 1.0900

After having recovered toward 1.1100 earlier in the day, GBP/USD turned south in the American session and touched its lowest level since 1985 below 1.0900. The PMI data from the US showed that the private sector activity recovered in September, fueling another leg higher in DXY.

GBP/USD News

Gold falls below $1,650, looks to post weekly losses

Gold falls below $1,650, looks to post weekly losses

Pressured by the renewed dollar strength on upbeat US PMI figures, gold lost its recovery momentum and dropped below $1,650. Meanwhile, the 10-year US T-bond yield is up nearly 1%, forcing XAU/USD to stay on the backfoot heading into the weekend.

Gold News

BTC makes a bullish comeback amid regulatory tension, but lacks confirmation

BTC makes a bullish comeback amid regulatory tension, but lacks confirmation

Bitcoin price has produced three consecutive lower lows since September 7, but at the same time, the Relative Strength Indicator (RSI) has shown a positive rise demonstrating a lack of underlying bearish power.

Read more

TSLA suffers as yields continue to dominate

TSLA suffers as yields continue to dominate

Tesla (TSLA) reacted poorly to the latest central bank developments with the stock falling 4% on Thursday. Main indices were not as badly hit with the S&P 500 losing less than 1% and the Nasdaq just over 1%.

Read more

Forex MAJORS

Cryptocurrencies

Signatures