ADP Non-Farm Employment Change
The EUR/USD was closed at $1.1901 after placing a high of $1.1930 and a low of $1.1878. EUR/USD pair continued its bearish stance and dropped for 4th consecutive session on Tuesday amid the strength in the U.S. dollar. The single currency Euro weakened against the U.S. dollar on Tuesday as the range of economic data came in negative on the day.
At the same time, the U.S. dollar was supported by the risk-off mood sentiment of the market due to its demand as a haven currency. The risk-off market sentiment emerged after the latest Delta variant of the coronavirus pushed another wave of coronavirus, specifically in the Asia-Pacific region of the world. Countries across the region started imposing fresh lockdown restrictions as coronavirus cases were on the surge continuously. The fears that economic recovery could disrupt because of the new lockdowns raised the demand for safe-haven that added strength to the U.S. dollar and added extra weight on riskier assets like EUR/USD pair.
On the data front, at 11:00 GMT, the German Prelim CPI remained flat with the expectations of 0.4%. At 12:00 GMT, the Spanish Flash CPI for the year dropped to 2.6% against the expectations of 2.7% and weighed on single currency Euro that added loss in EUR/USD pair. From the U.S. front, at 18:00 GMT, the Housing Price Index for April surged to 1.8% against the predicted 1.5% and supported the U.S. dollar that added further loss in EUR/USD. The S&P/CS Composite-20 HPI for the year remained flat with projections of 14.9%. Meanwhile, the single currency Euro was under pressure despite the reopening of the economy that has boosted the Eurozone economy in the second quarter of this year. The rising consumption and investments after reopening translate to a better picture of the economy; however, the disruption in the supply side seems to be holding back the strong recovery. As a result, Euro remains on the back foot against the U.S. dollar and keeps EUR/USD pair lower.
Conversely, the U.S. dollar strengthened due to the more hawkish tone by the Federal Reserve in its latest policy meeting this month. Two weeks ago, the central bank of the United States signalled to increase interest rates for the first time after the pandemic by the end of 2023 to 0.65 from the current 0.25%. Additionally, the Fed said that it would keep a close eye on economic data to decide the time of starting decreasing its monthly asset purchases of $120 billion. These comments from Fed added strength to the U.S. dollar. It was further accelerated on Tuesday as investors were now awaiting the release of the U.S. Non-Farm Employment figures from the Labour Department that could lay down support for the hawkish tone portrayed by the Fed. The U.S. Dollar Index reached above 92 levels on Tuesday and dragged EUR/USD pair downwards.
EUR/USD Intraday Technical Levels
Support Resistance
1.1876 1.1928
1.1851 1.1955
1.1824 1.1980
Pivot Point: 1.1903
EUR/USD - Technical Outlook
The EUR/USD is trading choppy but with a slight bearish bias at the 1.1894 level. The direct currency pair may face resistance at the 1.1916 level that's being extended by a 23.6% Fibonacci retracement level. On the higher side, a breakout of 1.1916 level extends pair towards next resistance at 1.1960 level (the 38.2% Fibonacci level). However, the 50 periods EMA will be there to extend resistance at the 1.1958 mark. Conversely, the 1.1879 support level breakout can expose the EUR/USD pair towards 1.1848 and 1.1824 levels today. Let's keep an eye on ADP Non-Farm Employment Change as this may drive further trends in the EUR/USD pair today. All the best!
JOIN LONGHORNFX TODAY
24/7 live support, lightning fast withdrawals, guaranteed safe and reliable trading platforms with a true ECN broker.