EUR/USD Forecast: To Defy Gravity Once Below 1.0980 A Strong Static Support Level

EUR/USD Current Price: 1.0999

• Equities kept rallying amid speculation of a coronavirus vaccine, US upbeat figures.
• The market’s attention shifts toward US employment-related data.
• EUR/USD to defy gravity once below 1.0980 a strong static support level.

The EUR/USD pair pierced the 1.1000 level this Wednesday, amid continued demand for the greenback and upbeat US data. The January ISM Non-Manufacturing PMI surprised with 55.5 after printing 54.9 in December, beating the market’s expectation of 55. Also, the ADP survey on private jobs’ creation almost duplicated expectations, printing at 291K in January. European data, on the other hand, came in mixed, as upbeat Markit Services PMI were offset by poor sales. The index resulted in 54.2 in Germany,  in line with the market’s expectations, while the EU index was upwardly revised to 52.5. EU December Retail Sales fell by more than anticipated, down by 1.6% in the month and posting a modest 1.3% annual advance.

Concerns about the coronavirus outbreak remain the same, although a headline indicating that UK scientist could be close to developing a vaccine spurred risk appetite mid-London session. WHO’s Chief, Dr. Tedros cooled down expectations, but equities retained their positive momentum, throughout the rest of the day.

This Thursday, Germany will release December Factory Orders, seen posting a modest 0.6% monthly advance and down by 6.0% yearly basis. The US will unveil employment-related data, relevant ahead of the Nonfarm Payroll report on Friday.

EUR/USD Short-Term Technical Outlook

The EUR/USD pair is battling with the 1.1000 level at the end of the day, maintaining its negative stance. It’s barely holding above this year low at 1.0991, although a more relevant static support level is 1.0980, a low from late November. Large stops should be gathered below this last. Technical readings in the 4-hour chart support a bearish breakout, as the pair is developing below all of its moving averages, which gain downward strength. Technical indicators remain close to oversold readings, although losing their bearish strength, anyway supporting additional slides ahead.

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