EURUSD Technical Analysis | Forexlive

USD

• The Fed left interest rates unchanged as
  expected at the last meeting and dropped the tightening bias in the statement.
• The US PCE came
  in line with expectations.
• The NFP report beat
  expectations on the headline number, but the unemployment rate and the average
  hourly earnings missed notably.
• The latest US ISM
  Manufacturing PMI missed expectations by a big margin
  remaining in contraction with the US ISM Services
  PMI
  following suit but holding on in expansion.
• The US Consumer
  Confidence missed expectations across the board.
• The market expects the first rate cut in June.

EUR

• The ECB left interest rates unchanged as
  expected at the last meeting revising inflation and growth expectations
  downwards and maintaining the usual data dependent language.
• The recent Eurozone CPI beat
  expectations.
• The labour market remains historically
  tight with the unemployment rate hovering at record lows.
• The latest Eurozone PMIs beat
  expectations on the Services side with the measure jumping back into expansion
  while the Manufacturing one missed dragged lower by Germany’s performance.
• The market expects the ECB to cut rates in June.

EURUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that EURUSD last
week almost reached the 1.10 handle as the US Dollar remained under pressure
amid weaker US data. From a risk management perspective, the buyers will have a
much better risk to reward setup around the trendline where
they will also find the red 21 moving average for confluence. The
sellers, on the other hand, will want to see the price breaking below the
trendline to invalidate the bullish setup and position for new lows.

EURUSD Technical Analysis –
4 hour Timeframe

On the 4
hour chart, we can see that the buyers will also find the 61.8% Fibonacci retracement level around
the trendline for extra confluence. A break below the trendline would bode well
for the sellers as the technical trend will likely turn around. For now, the
buyers remain in control with the 1.10 handle as target. A break above that
level should see the buyers increasing their bullish bets into the 1.1145 high.

EURUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that the
buyers have another strong support zone
around the 1.0920 where we can find the confluence of the minor trendline, the 50%
Fibonacci retracement level and the 4-hour 21 moving average. This is where we
can expect the buyers to step in with a defined risk below the trendline to
position for a rally into the 1.10 handle. The sellers, on the other hand, will
want to see the price breaking lower to invalidate this bullish setup and
position for a drop into the major trendline.

Upcoming Events

Today we have the main event of the week, that is
the US CPI report. On Thursday we get the US PPI, the US Retail Sales and the
US Jobless Claims figures. On Friday, we conclude the week with the University
of Michigan Consumer Sentiment survey.

See the video below