April 25, 2024

EUR/USD Price Overview: Near-Term Stabilization Probable

During Thursday’s trading session, the EUR/USD was trading around the lower end of its year-to-date range, near 1.1300.

Given the absence of a clear trend in either direction, it is likely that the pair will continue to consolidate in the very short term.

The initial resistance level is positioned beyond the 1.1380 level (January 3), while sellers should encounter competition near the 1.1270 level (January 4).

The overall bearish trend for the EUR/USD remains intact as long as the currency pair remains below the essential 200-day simple moving average (SMA) around 1.1744.

A Review Of The Technical Aspects

EUR/USD CHARTS Source: Tradingview.com

The EUR/USD pair is expected to retain its neutral to negative posture in the short term. The 4-hour chart reveals that the price fluctuates wildly around congested moving averages, which are all constrained to a 15-pip range daily. 

During this time, technical indicators cannot find a direction around their midlines.

The bullish position will acquire power if the exchange goes above 1.1385, which is an improbable possibility at the moment. At the same time, the bearish argument will grow more potent if the pair falls below 1.1220, which is the pair’s monthly low from December.

Support levels are as follows: 1.1260, 1.1120, and 1.1185

Resistance tiers: 1.1345, 1.1385, 1.1410

An Overview Of The Fundamentals

In the early hours of Thursday’s American trading day, the EUR/USD currency pair traded in a tight band at just over 1.1300.

According to the figures from Germany, the annual HICP decreased to 5.7% in December, which was in line with expectations. Market players are looking forward to the release of the US ISM Services PMI and Factory Orders data.

The EUR/USD pair has recovered from an intraday trough of 1.1284 and is currently trading at about 1.1300 as appetite for the USD has slowed, even though the market remains in a gloomy mood.

The conclusions of the Federal Open Market Committee’s meeting, released on Wednesday, revealed that officials are willing to speed up the pace of tapering, driving the dollar higher and equities lower.

Following Wall Street’s dismal performance, Asian and European stocks have continued to be under pressure for the time being.

The German government released November factory output figures, which were up 3.7% month on month, exceeding analysts’ estimates.

In November, the EU Producer Price Index increased by a stunning 23.7% year on year, while German inflation increased by 5.3% year on year in December.

In the United States, the November Goods Trade Balance showed a deficit of $99 billion, while the number of people filing weekly jobless claims increased to 207,500 in the week ended December 31.

After opening the stock market on Wall Street, the country will release factory orders and the December ISM Services PMI.

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