EUR/USD gathered bullish momentum and rose about 0.9% on Tuesday, erasing a large portion of Monday’s losses in the process. The pair stays in positive territory above 1.1200 in the European session on Wednesday and the technical outlook suggests that buyers could look to retain control in the near term.
Euro PRICE This week
The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.07% | -0.30% | 0.04% | 0.12% | -1.25% | -0.62% | 0.17% | |
| EUR | -0.07% | -0.23% | 0.58% | 0.54% | -0.69% | -0.20% | 0.58% | |
| GBP | 0.30% | 0.23% | 0.98% | 0.78% | -0.45% | -0.04% | 0.82% | |
| JPY | -0.04% | -0.58% | -0.98% | 0.06% | -1.92% | -1.50% | -0.11% | |
| CAD | -0.12% | -0.54% | -0.78% | -0.06% | -1.11% | -0.74% | 0.04% | |
| AUD | 1.25% | 0.69% | 0.45% | 1.92% | 1.11% | 0.40% | 1.26% | |
| NZD | 0.62% | 0.20% | 0.04% | 1.50% | 0.74% | -0.40% | 0.76% | |
| CHF | -0.17% | -0.58% | -0.82% | 0.11% | -0.04% | -1.26% | -0.76% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
The US Dollar (USD) came under selling pressure after soft inflation data on Tuesday and allowed EUR/USD to stage a decisive rebound. The US Bureau of Labor Statistics reported that annual inflation, as measured by the change in the Consumer Price Index (CPI), edged lower to 2.3% in April from 2.4% in March. On a monthly basis, the CPI and the core CPI both increased by 0.2%, compared to the market expectation of 0.3%.
The economic calendar will not offer any high-impact data releases that could influence EUR/USD’s action. Hence, market participants will pay close attention to comments from European Central Bank (ECB) and Federal Reserve (Fed) policymakers.
ECB Governing Council Gabriel Makhlouf said on Tuesday that soft data point to a significant cooling in business and consumer sentiment. On a hawkish note, Bundesbank President Joachim Nagel and ECB policymaker Jose Luis Escriva both argued that the ECB needs to be cautious on next rate steps. In case ECB officials reiterate the need to continue to reduce key rates, the Euro could have a difficult time preserving its strength.
In the meantime, the CME Group FedWatch Tool shows that markets are currently pricing in a less than 10% probability of a 25 basis points rate cut in June. This market positioning suggests that the USD doesn’t have much room left on the upside, even if Fed policymakers reaffirm a policy hold at next month’s meeting.
EUR/USD Technical Analysis by Prophet Forecast
EUR/USD was last seen trading near 1.1230, where the 200-period Simple Moving Average (SMA) on the 4-hour chart is located. In case the pair stabilizes above this level, the next immediate resistance is located at 1.1270 (Fibonacci 38.2% retracement of the latest uptrend) before 1.1310 (100-period SMA) and 1.1380 (Fibonacci 23.6% retracement).
On the downside, the first support level could be spotted at 1.1170 (Fibonacci 50% retracement) ahead of 1.1080-1.1090 (Fibonacci 61.8% retracement, 50-day SMA).