Market Overview

EUR/USD Forecast: Waiting For A Break Above 1.0900

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EUR/USD Forecast: Waiting For A Break Above 1.0900

EUR/USD Current Price: 1.0858

  • German upbeat data and mixed US figures helped EUR/USD to bounce.
  • Coronavirus spreading outside China spurred demand for safety.
  • EUR/USD bounced from 1.0800 area, waiting for a break above 1.0900.

Panic led the way this Monday. Weekend news indicating that the coronavirus continues to spread outside China, spurred concerns it would become a pandemic and hit harder global growth. The greenback opened the week gapping higher against most major rivals, except those considered safe-havens. The EUR/USD pair fell to 1.0804, although the dollar came under selling pressure after Wall Street’s opening, with bulls spooked by Wall Street’s collapse. The EUR/USD pair recovered to the 1.0860 region, where it stands ahead of Tuesday’s opening.

The German Business Climate Survey for February showed that the index bounced to 96.1  from 95.2 amid a bounce in the assessment and expectations. The US just released the January Chicago Fed National Activity Index, which improved to -0.25 from -0-51, also beating the market’s expectations of -0.92. The country also published the Dallas Fed Manufacturing Index, which resulted in 1.2 in February, below the 11.8 expected.

This Tuesday, Germany will release Q4 Gross Domestic Product, foreseen unchanged from the previous estimate at 0.0%. The US will publish the CB Consumer Confidence Index, the Richmond Fed Manufacturing Index and some minor housing data.

EUR/USD Short-Term Technical Outlook

The  EUR/USD pair is battling with the 23.6% retracement of its latest daily slump and near its daily high of 1.0871. In the 4-hour chart, the pair found support around a mild-bullish 20 SMA, while technical indicators have bounced from their midlines, maintaining their upward slopes and near their daily highs. The 100 SMA has extended its decline, approaching the 38.2% retracement of the mentioned decline at 1.0900. The pair would need to advance beyond this last to gain bullish traction, quite unlikely in the current risk-averse scenario.

Support levels: 1.0770 1.0725 1.0690

Resistance levels: 1.0860 1.0900 1.0930

Image Sourced from Pixabay

 

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Posted-In: EUR/USD European UnionNews Eurozone Forex Global Markets General

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