EUR/USD portrays holiday mood below 1.0640 hurdle despite US Dollar pullback

EUR/USD remains sidelined after an upbeat start to the likely quiet week.
Softer US data, hawkish ECB outshine Fed talks amid light calendar, year-end sluggish sentiment.
Firmer yields, recession woes challenge pair buyers, sellers await US PCE Price Index.

Anil Panchal FXStreet

EUR/USD seesaws near 1.0600 as it snaps two-day downtrend amid early Monday in Europe.

The major currency pair’s latest inaction could be linked to the cautious sentiment ahead of this week’s US data, as well as mixed concerns surrounding European growth. However, hawkish comments from the European Central Bank (ECB) policymakers and the central bank’s readiness for higher rates keep buyers hopeful.

During the last week, European PMIs have been better than the first readings of the US activity data and bolstered the bullish bias of the ECB policymakers. Additionally, chatters that the bloc’s policymakers may ease control on the oil price cap to get the resolution passed also keep the EUR/USD prices firmer, via hopes of higher oil prices and a stronger need to tame the higher inflation.

It’s worth noting, however, that the higher rates and inflation fears favor the recession woes and underpin the Treasury bond yields, which in turn tease the US Dollar bulls amid a sluggish session. Also likely to have teased the greenback buyers could be the recently hawkish comments from the Fed policymakers, including Federal Reserve Bank of Cleveland President Loretta Mester and New York Federal Reserve President John Williams.

Above all, the year-end consolidation and holiday mood join the light calendar to restrict immediate EUR/USD moves. Even so, the final readings of the US Q3 GDP and the Fed’s preferred version of inflation, namely Friday’s US Core Personal Consumption Expenditures (PCE) - Price Index, expected 4.6% YoY and 5.0% previous readings, will be important to watch for fresh impulse.

Technical analysis

A daily closing beyond the previous support line from November 30, around 1.0640, becomes necessary to convince EUR/USD bulls. Otherwise, a convergence of the 21-DMA and the mid-November peak could challenge the pair sellers near 1.0480.

Additional important levels

Overview
Today last price	1.0607
Today Daily Change	0.0015
Today Daily Change %	0.14%
Today daily open	1.0592

Trends
Daily SMA20	1.0475
Daily SMA50	1.0176
Daily SMA100	1.0086
Daily SMA200	1.0345

Levels
Previous Daily High	1.0663
Previous Daily Low	1.0592
Previous Weekly High	1.0736
Previous Weekly Low	1.0506
Previous Monthly High	1.0497
Previous Monthly Low	0.973
Daily Fibonacci 38.2%	1.0619
Daily Fibonacci 61.8%	1.0636
Daily Pivot Point S1	1.0569
Daily Pivot Point S2	1.0545
Daily Pivot Point S3	1.0497
Daily Pivot Point R1	1.064
Daily Pivot Point R2	1.0687
Daily Pivot Point R3	1.0711

Author

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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