EUR/USD Analysis - April 16, 2021

Bullish Bat Pattern in Play!

During Friday's Asian trading hours, the EUR/USD currency pair failed to stop its overnight losing streak and remained sidelined below the 1.1950 level. The German bund yield's dropped from the 1-month high, with the most significant daily losses since early March. This eventually triggered the pair's pullback from a 7-week high to snapped a 3-day winning streak overnight. Besides this, the selling bias around the currency pair could also be attributed to the market risk-off sentiment that's underpinning the U.S. dollar and contributing to the currency pair gains.

The losses in the EUR/USD currency pair were further bolstered by the latest report suggesting that the U.S. Centers for Disease Control and Prevention (CDC) extended the ban on the use of Johnson & Johnson's covid vaccine. In response, the single currency Euro took a hit as this news may cause a slow down in Eurozone's economic recovery. The EUR/USD is trading at 1.1968 and consolidating in the range between 1.1950 - 1.1974.

The global equity market failed to extend its previous-day positive performance and turned bearish on the day as U.S. - Russia and Sino-American tussles getting worse day by day. The U.S. decided to inflict sanctions on Russia over election interference and hacking, which is recently gained significant market attention. However, U.S. President Joe Biden strongly supported the move while saying to Russian President Vladimir Putin, "The U.S. could slap further sanctions, but Biden chose not to do so." Thus, the news added to the market's risk-off sentiment and helped the U.S. dollar stay bid.

In the meantime, U.S. President Biden and Japanese Prime Minister Yoshihide Suga are set to meet in the White House at about 13:30 GMT on the day. Wherein they would talk about China, as per the report from the U.S. Administration official. After the U.S. attempt to gather global support while battling with China, the U.S. -China tension is expected to intensify further as Beijing recently warned America over Hong Kong and Taiwan's role. Hence, the fears of a full-fledged trade/political war between the U.S. and China have been pondering on the market trading sentiment and were seen as one of the leading factors that kept the EUR/USD currency pair lower. Looking forward, the market traders will keep their eyes on the final reading of March's Eurozone Consumer Price Index (CPI), which is expected to confirm 1.3% YoY figures. Apart from this, the U.S. data will also be essential to watch. In addition to this, updates over the vaccine will not lose their importance. Let's take a look at the technical side of the market.

EURUSD Intraday Technical Levels

Support Resistance

1.1898 1.1976

1.1849 1.2005

1.1820 1.2053

Pivot Point: 1.1927

EUR/USD - Technical Outlook

On Friday, the technical side of the EUR/USD hasn't changed a lot as the market continues to lack high-impact economic events from both of the Nations, the U.S., and the Eurozone. The single currency Euro is consolidating below an immediate resistance level of 1.1938 level. This resistance level is extended by a triple top pattern that we can see on the daily timeframe. On the daily timeframe, the EUR/USD closed a bullish bat pattern that typically drives a bullish trend in the market, and it did push the single currency Euro higher towards 1.1983 resistance. On the higher side, a breakout of triple top resistance 1.1983 can open room for a further bullish trend. The EUR/USD's next resistance stays at 1.2043, 1.2112, and 1.2246 areas. At the same time, the support continues to hold at 1.1915 and 1.1865. Today, the investor's focus will stay on Final CPI y/y, Final Core CPI y/y, and Trade Balance figures from the Eurozone economy. All the best!