EUR/USD Price Analysis: US credit rating cut, 1.0980 support tease Euro bulls ahead of US employment clues
- EUR/USD prints the first daily gains in three as US credit rating downtrend weighs on Greenback.
- Convergence of 50-EMA, two-month-old rising support line triggers latest recovery.
- 21-EMA, fortnight-old descending resistance line will join US ADP Employment Change.
- Downbeat sentiment, bearish MACD signals favor Euro bears despite recent rebound.
EUR/USD clings to mild gains around 1.1000 round figure as it snaps a two-day losing streak during early Wednesday. In doing so, the Euro pair benefits from the US Dollar’s pullback amid the US credit rating downgrade while reversing from a convergence of the 50-day Exponential Moving Average (EMA) and an upward-sloping support line from early June as it awaits the US ADP Employment Change for July, expected 189K versus 497K prior.
Also read: EUR/USD regains 1.1000 on US credit rating cut, focus on ADP Employment Change
Even if the major currency pair bounces off the 1.0980 key support comprising 50-EMA and a multi-day-old rising trend line, the 21-EMA hurdle of around 1.1035 joins the bearish MACD signals and steady RSI to challenge the buyers.
Although the quote crosses the 1.1035 upside hurdle, a two-week-long descending resistance line will act as the final defense of the EUR/USD bears near 1.1080.
Following that, May’s high of 1.1090 and the late July swing high of around 1.1150 could lure the Euro bulls before directing them to the yearly high marked the last month around 1.1275.
Alternatively, a daily closing below 1.0980 support confluence could quickly drag EUR/USD toward the previous monthly low of 1.0833 before highlighting the early June swing high of near 1.0780 to them.
However, an ascending trend line from mid-March, close to 1.0770 at the latest, could challenge the EUR/USD bears afterward.
EUR/USD: Daily chart
Trend: Further downside expected
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.
