Violated Trendline Supports Euro at 1.1850
The EUR/USD was closed at $1.1870 after placing a high of $1.1910 and a low of $1.1851. EUR/USD currency pair broke its 5-day bullish streak and dropped on Friday amid the renewed strength of the U.S. dollar. The U.S. dollar gathered its strength against the basket of six major currencies at the ending trading day of the month and reached 92.24 level on Friday that added extra pressure on its rival currencies like Euro.
The Italian Prelim CPI for July rose to 0.3% against the forecasted 0.1% and supported Euro, reducing the declining pressure on EUR/USD. The Prelim Flash GDP for the quarter surged to 2.0% against the projected 1.5% and pushed Euro higher that caped further loss in EUR/USD. The Unemployment Rate from the whole bloc decreased in June to 7.7% against the forecasted 7.9%% and supported the single currency Euro and limited the decline in EUR/USD.
From the U.S. side, at 17:30 GMT, the Core CPE Price Index for June dropped to 0.4% against the forecasted 0.6% and weighed on the U.S. dollar that limited the decline in EUR/USD prices. The Employment Cost Index also dropped to 0.7% against the projected 0.9% and weighed on the U.S. dollar that caped further loss in EUR/USD. Personal Income from June rose to 0.1% against the predicted -0.4% and supported the U.S. dollar that added further pressure on EUR/USD.
Personal Spending in June also surged to 1.0% against the anticipated 0.7% and supported the U.S. dollar that added further loss in EUR/USD. At 18:45 GMT, the Chicago PMI for July increased to 73.4 against the projected 64.2 and supported the U.S. dollar that dragged EUR/USD even lower on Friday. At 19:00 GMT, the Revised UoM Consumer Sentiment in July remained flat at 81.2. The Revised UoM Inflation Expectations dropped in July to 4.7% against the previous 4.8%.
Apart from the macroeconomic data, the single currency Euro was under pressure on Friday as the European nations struggled to fight the 4th wave of the coronavirus. Some countries of the region started tightening border controls as the Delta variant of the coronavirus triggered a rise in the number of coronavirus cases. According to the World Health organization, the Delta variant has become the dominant variant in much of Europe.
Meanwhile, on Friday, it was reported that Pfizer and Moderna had raised the prices of their COVID-19 vaccines in the latest supply contracts with Europe. Pfizer raised its per shot prices to €19.50 from the previous €15.50, while Moderna raised its per shot price to €21.48 from €19. The demand from the E.U. increased for these vaccine shots as other vaccine shots gave some side effects to people and because the E.U. set a plan to hit a target of fully vaccinated 70% of the adult population by the end of the summer.
EUR/USD Intraday Technical Levels
Pivot Point: 1.1866
EUR/USD - Technical Outlook
The EUR/USD currency pair is trading with a slightly bullish bias on Monday at the 1.1875 level, gaining immediate support at the 1.1850 level. On the higher side, the resistance stays at the 1.1907 level. On the 4-hourly chart, the EUR/USD pair has already violated the downward trendline that’s now extending support at the 1.1850 level.
A bearish breakout of this support level can expose the EUR/USD pair towards 1.1810 support. That’s where the 50 M.A. (moving average) stays and can trigger a bounce off in the EUR/USD. However, the bearish crossover below this level can expose the EUR/USD pair towards the 1.1760 support level. The bullish bias dominates the EUR/USD above 1.1850 today. All the best.
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