EUR/USD Forecast: Maintains Its Bearish Stance Despite Paring The Weekly Slump

EUR/USD Current Price: 1.1670

• Softer-than-expected data confirmed a slowing pace of economic recovery.
• US Durable Goods Orders are seen advancing a modest 1.5% in August.
• EUR/USD maintains its bearish stance despite paring the weekly slump.

The EUR/USD is ending Thursday with modest gains around 1.1670, although it posted a lower low for the week at 1.1626. Demand for the greenback prevailed throughout the first half of the day amid ruling risk aversion. However, dismal US data and equities bouncing off daily lows, put some pressure on the dollar in the last trading session of the day.

Data was softer-than-anticipated on both shores of the Atlantic. Germany published the September Business Climate survey which improved to 93.4, below the expected 93.8. The US, on the other hand, released Initial Jobless Claims for the week ended September 18, which came in at 870K worse than the 843K expected and the previous 866K. Continuing Jobless Claims for the week ended September 11 increased to 12.58M. Stubbornly high unemployment levels in the US took their toll on the dollar.

This Friday, the focus will be on August US Durable Goods Orders, seen advancing a modest 1.5% following an increase of 11.4% in the previous month. The core reading, the so-called Nondefense Capital Goods Orders ex Aircraft, is foreseen at 0.5% from 1.9%

EUR/USD Short-Term Technical Outlook

The EUR/USD pair has posted a lower low and a lower high daily basis, which suggests that bears retain control. The 4-hour chart shows that technical indicators have recovered from oversold readings but turned flat within negative levels. Meanwhile, the pair continues to develop well below moving averages, with the 20 SMA providing dynamic resistance around 1.1700. The 100 SMA grinds lower below the 200 SMA and far above the larger one, in line with further declines ahead.

Support levels: 1.1620 1.1580 1.1530

Resistance levels: 1.1685 1.1725 1.1760  

View Live Chart for the EUR/USD

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