EUR/USD outlook: euro struggles below 1.0350 amid US data anticipation
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The EUR/USD pair remains subdued, trading slightly below 1.0350 during Wednesday’s European session. After Monday’s gains, the pair reversed on Tuesday, reflecting cautious sentiment as traders await key US employment data and Federal Reserve minutes.
Euro Weakness Amid Dollar Strength
The US Dollar gained traction on Tuesday, supported by:
ISM Services PMI improving to 54.1 in December from 52.1 in November, signaling stronger expansion in the services sector
JOLTS Job Openings increasing to 8.09 million in November from 7.84 million in October, exceeding expectations
This robust macroeconomic data reinforced the USD’s resilience, pressuring EUR/USD lower.
Key Market Drivers Today
Investors are closely monitoring:
ADP Employment Change data: Expected private payroll growth of 140,000 in December. A stronger-than-expected reading (above 150,000) could further support the USD, while a weaker print (below 130,000) might weigh on the greenback
FOMC Minutes: Insights into the Fed’s December policy meeting will influence expectations around future rate decisions. A hawkish tone would likely bolster the USD
Technical Analysis: EUR/USD Levels to Watch
The EUR/USD technical setup indicates continued buyer hesitation:
The Relative Strength Index (RSI) on the 4-hour chart is below 50, signaling bearish sentiment
The pair is trading below the 20-period and 50-period Simple Moving Averages (SMA), reinforcing downside pressure
Support Levels:
1.0320, aligning with the Fibonacci 23.66% retracement of the latest downtrend
1.0300, a psychological and static level
1.0240, marking the endpoint of the recent downtrend
Resistance Levels:
1.0370, corresponding to the 50-period SMA and Fibonacci 38.2% retracement
1.0400, near the 100-period SMA
1.0420, aligning with the Fibonacci 50% retracement
Conclusion
The EUR/USD pair remains under pressure as buyers hesitate to break higher. The direction will largely depend on the outcome of key US data releases and the tone of the FOMC minutes. A hawkish Fed and strong employment data could further strengthen the USD, while any signs of weakness might provide relief for the Euro. Traders should monitor these pivotal events for clear directional cues.
Euro Weakness Amid Dollar Strength
The US Dollar gained traction on Tuesday, supported by:
ISM Services PMI improving to 54.1 in December from 52.1 in November, signaling stronger expansion in the services sector
JOLTS Job Openings increasing to 8.09 million in November from 7.84 million in October, exceeding expectations
This robust macroeconomic data reinforced the USD’s resilience, pressuring EUR/USD lower.
Key Market Drivers Today
Investors are closely monitoring:
ADP Employment Change data: Expected private payroll growth of 140,000 in December. A stronger-than-expected reading (above 150,000) could further support the USD, while a weaker print (below 130,000) might weigh on the greenback
FOMC Minutes: Insights into the Fed’s December policy meeting will influence expectations around future rate decisions. A hawkish tone would likely bolster the USD
Technical Analysis: EUR/USD Levels to Watch
The EUR/USD technical setup indicates continued buyer hesitation:
The Relative Strength Index (RSI) on the 4-hour chart is below 50, signaling bearish sentiment
The pair is trading below the 20-period and 50-period Simple Moving Averages (SMA), reinforcing downside pressure
Support Levels:
1.0320, aligning with the Fibonacci 23.66% retracement of the latest downtrend
1.0300, a psychological and static level
1.0240, marking the endpoint of the recent downtrend
Resistance Levels:
1.0370, corresponding to the 50-period SMA and Fibonacci 38.2% retracement
1.0400, near the 100-period SMA
1.0420, aligning with the Fibonacci 50% retracement
Conclusion
The EUR/USD pair remains under pressure as buyers hesitate to break higher. The direction will largely depend on the outcome of key US data releases and the tone of the FOMC minutes. A hawkish Fed and strong employment data could further strengthen the USD, while any signs of weakness might provide relief for the Euro. Traders should monitor these pivotal events for clear directional cues.