• EUR/USD adds to the first weekly gains in four amid quiet session.
  • Recession fears keep markets dicey, US dollar fails to track firmer yields.
  • Hawkish ECBSpeak, repetitive comments from Fed’s Powell favor buyers.
  • German IFO sentiment figures for June, and second-tier US data may entertain traders.

EUR/USD renews intraday high near 1.0530 as it eyes to snap three-week downtrend during Friday’s Asian session. The major currency pair’s latest gains could be linked to the US dollar’s weakness as traders rush towards Treasury bonds amid recession fears.

That said, the US Dollar Index (DXY) seesaws around 104.40, after snapping the three-day downtrend the previous day. Even so, the greenback gauge remains on the way to posting the first weekly loss in four.

Fed Chair Jerome Powell’s concern for recession joined downbeat US PMI data to favor the greenback buyers the previous day. However, the mentioning of inflation and recession woes as the challenges to ensure a smooth landing, despite expecting firmer growth this year, weigh on the DXY.

It’s worth noting that downbeat US PMIs also added to the risk-aversion and fuelled the US dollar’s safe-haven demand. S&P Global Services PMI for the US slumped to 51.6 in June from 53.4 prior, not to forget missing the 53.5 forecasts. Further, the Manufacturing PMI not only missed the market expectation of 56 by a wide margin in June, to 52.4 versus 57.00 prior, but also slumped to a nearly two-year low.

On the other hand, German Economy Minister Robert Habeck rang the alarm of gas shortages by announcing a move to stage two of its three-stage gas plan amid reduced Russian flows. Additionally, the European Central Bank (ECB) published Economic Bulletin on Thursday, underscoring challenges to the economy from higher inflation. The ECB Bulletin also mentioned, “The Governing Council will make sure that inflation returns to its 2% target over the medium term.”

It’s worth noting that Governing Council member and German central bank head Joachim Nagel mentioned on Thursday that "The risk of inflation expectations becoming de-anchored has risen over the past months." The policymaker also said, "If monetary policy falls behind the curve, even stronger hikes in interest rates could become necessary to get inflation under control.”

Despite the market’s pessimism, the Wall Street benchmarks closed positively due to the downbeat Treasury yields. However, the S&P 500 Futures rise 0.30% while the US 10-year Treasury yields remain firmer around 3.09%, after dropping to a fortnight low the previous day.

Looking forward, Germany’s IFO numbers for June will be crucial after the bloc’s powerhouse signaled fears of an energy crisis. That said, the IFO – Business Climate is expected to ease to 92.9 from 93.0 while the Current Assessment is also likely to weaken to 99.0 from 99.5. However, the IFO – Expectations are likely to improve to 87.4 from 86.9, which in turn can help the EUR/USD buyers.

In addition to the German IFO numbers, US New Home Sales for May and comments from ECB Vice President Luis de Guindos also appear important for short-term EUR/USD directions.

Technical analysis

Given the sluggish MACD signals and steady RSI, coupled with the quote’s ability to recover from important supports, the EUR/USD pair is likely to run towards the 200-SMA hurdle surrounding 1.0585.

Among the key supports, the 50-SMA and horizontal area comprising multiple levels marked since mid-May., respectively near 1.0495 and 1.0470-60, gain major attention.

Additional important levels

Overview
Today last price 1.0529
Today Daily Change 0.0006
Today Daily Change % 0.06%
Today daily open 1.0523
 
Trends
Daily SMA20 1.0603
Daily SMA50 1.0609
Daily SMA100 1.0857
Daily SMA200 1.1144
 
Levels
Previous Daily High 1.0581
Previous Daily Low 1.0483
Previous Weekly High 1.0601
Previous Weekly Low 1.0359
Previous Monthly High 1.0787
Previous Monthly Low 1.035
Daily Fibonacci 38.2% 1.052
Daily Fibonacci 61.8% 1.0544
Daily Pivot Point S1 1.0477
Daily Pivot Point S2 1.0431
Daily Pivot Point S3 1.0379
Daily Pivot Point R1 1.0575
Daily Pivot Point R2 1.0627
Daily Pivot Point R3 1.0674

 

 

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 steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures