EUR/USD: euro tests resistance amid mixed USD sentiment
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The EUR/USD pair maintains its bullish momentum, trading above the 1.0400 mark during the European session on Tuesday. While the US Dollar (USD) faces selling pressure, key resistance levels could limit further gains for the Euro.
Euro Gains Amid USD Weakness
The Euro started the week strong, benefiting from:
USD softness fueled by reports of potential tariffs under President-elect Donald Trump’s administration. Although Trump dismissed the reports as “fake news,” the USD failed to recover, weighed down by risk-on sentiment.
Investor focus on the Eurozone Harmonized Index of Consumer Prices (HICP) for December, expected to rise 2.4% year-over-year, signaling potential strength for the Euro.
US Economic Data in Focus
Traders are also awaiting key US economic reports later in the day:
ISM Services PMI, forecast to rise to 53. A reading below 50 may weaken the USD further, while a figure above 55 could lend support to the greenback.
JOLTS Job Openings, providing additional clarity on the US labor market.
Technical Analysis: Critical Levels for EUR/USD
The EUR/USD pair exhibits a bullish bias, reflected by the RSI indicator holding above 60 on the 4-hour chart.
Resistance levels to monitor:
The 1.0410-1.0420 zone, reinforced by the Fibonacci 50% retracement level and 100-period SMA. A break above this range could target:
1.0460, aligned with the Fibonacci 61.8% retracement and 200-period SMA.
1.0520, near the Fibonacci 78.6% retracement level.
Support levels to watch:
1.0370, marked by the Fibonacci 38.2% retracement and 50-period SMA.
1.0320, near the Fibonacci 23.6% retracement and 20-period SMA.
Conclusion
The EUR/USD outlook remains bullish but hinges on overcoming key resistance at 1.0410-1.0420. Market participants should monitor Eurozone inflation data and US economic releases for signals that could drive the pair’s next move.
Euro Gains Amid USD Weakness
The Euro started the week strong, benefiting from:
USD softness fueled by reports of potential tariffs under President-elect Donald Trump’s administration. Although Trump dismissed the reports as “fake news,” the USD failed to recover, weighed down by risk-on sentiment.
Investor focus on the Eurozone Harmonized Index of Consumer Prices (HICP) for December, expected to rise 2.4% year-over-year, signaling potential strength for the Euro.
US Economic Data in Focus
Traders are also awaiting key US economic reports later in the day:
ISM Services PMI, forecast to rise to 53. A reading below 50 may weaken the USD further, while a figure above 55 could lend support to the greenback.
JOLTS Job Openings, providing additional clarity on the US labor market.
Technical Analysis: Critical Levels for EUR/USD
The EUR/USD pair exhibits a bullish bias, reflected by the RSI indicator holding above 60 on the 4-hour chart.
Resistance levels to monitor:
The 1.0410-1.0420 zone, reinforced by the Fibonacci 50% retracement level and 100-period SMA. A break above this range could target:
1.0460, aligned with the Fibonacci 61.8% retracement and 200-period SMA.
1.0520, near the Fibonacci 78.6% retracement level.
Support levels to watch:
1.0370, marked by the Fibonacci 38.2% retracement and 50-period SMA.
1.0320, near the Fibonacci 23.6% retracement and 20-period SMA.
Conclusion
The EUR/USD outlook remains bullish but hinges on overcoming key resistance at 1.0410-1.0420. Market participants should monitor Eurozone inflation data and US economic releases for signals that could drive the pair’s next move.