Market Overview

EUR/USD Forecast: Neutral In The Near-term But Not Far From This Year's High

EUR/USD Forecast: Neutral In The Near-term But Not Far From This Year's High

EUR/USD Current Price: 1.2209

  • Trading was choppy at the beginning of the week and will likely extend this week.
  • The US December Dallas Fed Manufacturing Business Index printed at 9.7.
  • EUR/USD is neutral in the near-term but not far from this year’s high.

Major crosses held within familiar levels at the weekly opening, with the EUR/USD pair finishing the day a handful of pips above the 1.2200 level. The dollar fell at the weekly opening after the US announced that President Donald Trump signed the coronavirus-relief/government funding bill. With London off, celebrating Boxing Day, the American currency found some demand, although its bullish potential was offset by risk-appetite. US indexes reached record highs despite moderate action, boosted by stimulus news.

The macroeconomic calendar has little to offer in this shortened week. The US published the December Dallas Fed Manufacturing Business Index that came in at 9.7. This Tuesday, the country will publish the S&P Home Prices Index for October, which usually has no impact on currencies.

EUR/USD short-term technical outlook

The EUR/USD pair trades around 1.2200 at the end of the American session, offering a neutral short-term stance. The 4-hour chart shows buyers appeared around a flat 20 SMA, while the longer moving averages maintain their bullish slopes below it. The Momentum indicator advances after testing its midline, while the RSI consolidates around 51. The pair would need to advance beyond 1.2277, the year’s high, to turn bullish and attract additional speculative interest.

Support levels: 1.2130 1.2085 1.2040

Resistance levels: 1.2220 1.2275 1.2310

View Live Chart for the EUR/USD


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