- EUR/USD continued to edge higher after posting gains on Wednesday.
- Investors await September inflation data from the US.
- Buyers are likely to remain interested as long as the Euro holds above 1.0570-1.0580.
EUR/USD continued to stretch higher toward 1.0650 early Thursday after posting small daily gains on Wednesday. The near-term technical outlook suggests that the pair is close to turning overbought but investors could ignore this condition in case US inflation data come in softer than forecast.
Risk flows continued to dominate the financial markets mid-week and the US Dollar found it difficult to hold its ground. Additionally, dovish comments from Federal Reserve (Fed) officials triggered another leg lower in US Treasury bond yields and further weighed on the currency.
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 US Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.59% | -0.76% | -0.55% | -0.72% | -0.03% | -0.57% | -0.97% | |
| EUR | 0.57% | -0.17% | 0.05% | -0.14% | 0.55% | 0.01% | -0.36% | |
| GBP | 0.75% | 0.17% | 0.21% | 0.00% | 0.71% | 0.16% | -0.20% | |
| CAD | 0.54% | -0.04% | -0.22% | -0.17% | 0.50% | -0.04% | -0.41% | |
| AUD | 0.72% | 0.17% | 0.00% | 0.22% | 0.72% | 0.16% | -0.20% | |
| JPY | 0.03% | -0.53% | -0.72% | -0.46% | -0.74% | -0.59% | -0.91% | |
| NZD | 0.59% | 0.01% | -0.16% | 0.06% | -0.16% | 0.56% | -0.37% | |
| CHF | 0.93% | 0.37% | 0.20% | 0.41% | 0.21% | 0.89% | 0.33% |
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 Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
Early Thursday, US stock index futures trade in positive territory, pointing to an upbeat market mood.
In the second half of the day, September Consumer Price Index (CPI) data from the US will be watched closely by market participants. Investors expect the CPI and the Core CPI, which excludes volatile food and energy prices, to rise 0.3% on a monthly basis.
According to the CME Group FedWatch Tool, markets are pricing in a 72% probability that the Fed will leave the policy rate unchanged this year. In case the monthly Core CPI comes in weaker than expected, dovish Fed bets could continue to drive the market action. In that scenario, US stocks could extend the weekly rally and the USD could further weaken. On the other hand, the USD could stage a correction on a strong Core CPI reading of 0.5% or above and cause EUR/USD to erase a large portion of its weekly gains.
EUR/USD Technical Analysis
The Relative Strength Index (RSI) indicator on the four-hour chart climbed to 70 early Thursday. In case the pair makes a technical correction, 1.0600 (psychological level, static level, ascending trend line) aligns as first support before the 1.0570-1.0580 area (Fibonacci 23.6% retracement, 20-period Simple Moving Average, 100-period SMA). A 4-hour close below the latter could discourage buyers and open the door for further losses toward 1.0540 (50-period SMA).
On the upside, immediate resistance is located at 1.0640 (Fibonacci 38.2% retracement of the latest downtrend) before 1.0670, where the 200-period Simple Moving Average (SMA) is located, and 1.0700 (Fibonacci 50% retracement, psychological level).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD stabilizes near 1.0500, looks to post weekly losses
EUR/USD extended its daily decline toward 1.0500 in the second half of the American session, pressured by the souring market mood. Despite the bullish action seen earlier in the week, the pair remains on track to register weekly losses.
GBP/USD falls below 1.2150 as USD rebounds
Following an earlier recovery attempt, GBP/USD turned south and declined below 1.2100 in the second half of the day on Friday. The negative shift seen in risk mood amid rising geopolitical tensions helps the US Dollar outperform its rivals and hurts the pair.
Gold advances to fresh multi-week highs above $1,920
Gold extended its daily rally and climbed above $1,920 for the first time in over two weeks on Friday. Escalating geopolitical tensions ahead of the weekend weigh on T-bond yields and provide a boost to XAU/USD, which remains on track to gain nearly 5% this week.
Bitcoin could be an alternative to US-listed companies but not in the short term
Bitcoin has dipped below $27,000, adding to the subdued cryptocurrency market sentiment. While short-term price concerns persist, analysts predict a rebound based on historical figures.
Nvidia Stock Forecast: NVDA slips as Biden administration attempts to close AI chip loophole
Nvida's stock price opened marginally lower on Friday after Reuters reported that the Biden administration is attempting to close a loophole that allowed Chinese companies access to state-of-the-art computer chips used for AI.