EUR/USD steadies around 1.1750, on track to snap four-day losing streak

EUR/USD reversed its direction after dropping below 1.1700.
FOMC-inspired US Dollar Index rally lost momentum on Thursday.
Wall Street's main indexes are posting impressive gains.

Eren Sengezer FXStreet

Following Wednesday's sharp decline, the EUR/USD pair spent the first half of the day moving sideways below 1.1700. With the greenback coming under renewed selling pressure during the American session, the pair gained traction and reached a daily high of 1.1751. As of writing, EUR/USD was up 0.5% on the day at 1.1745.

DXY reverses course

The FOMC's hawkish policy outlook seen in the Summary of Economic Projections and Chairman Jerome Powell's comments about asset tapering starting as soon as the next meeting provided a boost to the USD on Wednesday. Reflecting the broad-based USD strength, the US Dollar Index (DXY) climbed to its highest level in more than a month at 93.52.

However, the positive shift witnessed in market sentiment caused the DXY to push lower in the second half of the day. Currently, the index is losing 0.45% at 93.03. Supported by heightened hopes about the Chinese real-estate giant Evergrande avoiding a default, the S&P 500 Index is rising 1.45% on the day at 4,459.

Earlier in the day, the data from the US revealed that the weekly Initial Jobless Claims rose to 351,000 from 335,000 previously. Additionally, the Markit Manufacturing PMI declined to 60.5 in September's flash estimate while the Services PMI edged lower to 54.4 from 55.1. Nevertheless, these disappointing readings had little to no impact on risk perception.

On Friday, IFO Business Climate and Current Assessment data from Germany will be looked upon for fresh impetus. Later in the day, the August New Home Sales report will be featured in the US economic docket.

Technical levels to watch for

EUR/USD

Overview
Today last price	1.1745
Today Daily Change	0.0057
Today Daily Change %	0.49
Today daily open	1.1688

Trends
Daily SMA20	1.1799
Daily SMA50	1.179
Daily SMA100	1.1916
Daily SMA200	1.1985

Levels
Previous Daily High	1.1756
Previous Daily Low	1.1684
Previous Weekly High	1.1846
Previous Weekly Low	1.1724
Previous Monthly High	1.19
Previous Monthly Low	1.1664
Daily Fibonacci 38.2%	1.1711
Daily Fibonacci 61.8%	1.1728
Daily Pivot Point S1	1.1662
Daily Pivot Point S2	1.1637
Daily Pivot Point S3	1.1591
Daily Pivot Point R1	1.1734
Daily Pivot Point R2	1.1781
Daily Pivot Point R3	1.1806

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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