Choppy Session in Play
The EUR/USD closed at 1.2140 after placing a high of 1.2150 and a low of 1.2070. EUR/USD pair rose on Friday after declining for two consecutive days and recovered most of its previous day’s losses amid the weakness in the U.S. dollar. On Friday, the European Central Bank released its latest minutes from the meeting held in March. The central bank noted that they succeeded in maintaining favorable financing conditions as the recent measures had been effective.
ECB also stated that the risks to activity had become more balanced as they were tilted to the upside. This hawkish comment came after so long as the risks had been on the downside due to slow vaccination campaigns in the EU. However, if the vaccination program goes well, there are more chances that ECB could deliver more clues on tightening. The Governing Council of the European Central bank did not discuss any tapering of the bond program. Furthermore, the minutes from the meeting also suggested that countries across Europe with more service-dependent were anticipated to improve at a slower pace despite re-opening. Euro became strong after the release of minutes from ECB and pushed EUR/USD pair higher on Friday.
On the other hand, the U.S. dollar remained weak for the day due to a weaker-than-expected macroeconomic data release. The U.S. Dollar Index fell to $90.27, and the U.S. Treasury yields on the 10-year note dropped to 1.625% on Friday that added further pressure on the U.S. dollar and pushed EUR/USD higher on board.
There was no data to be released from the Europe side on the data front, but from the U.S. side, at 17:30 GMT, Retail Sales for April declined to 0.0% against the estimated 1.0% and weighed on the U.S. dollar that pushed EUR/USD pair higher. The Import Prices remained flat with the projections of 0.7%. At 17:32 GMT, the Core Retail Sales declined to -0.8% against the anticipated 0.5% and weighed on the U.S. dollar that added further gains in EUR/USD. At 18:15 GMT, the Industrial Production for April also fell to 0.7% against the predicted 0.9% and weighed on the U.S. dollar that supported EUR/USD gains. The Capacity Utilization Rate remained flat as expected 75.0%.
At 19:00 GMT, the Prelim UoM Consumer Sentiment for May dropped to 82.8 against the anticipated 90.2 and weighed on the U.S. dollar that pushed EUR/USD higher. Business Inventories remained flat at 0.3% expected. The Prelim UoM Inflation Expectations also remained flat as projected 4.6%. The dismal economic data from the U.S. added pressure on the already declining U.S. dollar and supported the rising prices of the EU/USD currency pair on Friday.
EURUSD Intraday Technical Levels
Support Resistance
1.2050 1.2108
1.2021 1.2137
1.1992 1.2165
Pivot Point: 1.2079
EUR/USD - Technical Outlook
The EUR/USD is trading choppy from 1.2150 to 1.2120 level. Technical side of the EUR/USD pair has remain mostly unchanged as the direct currency pair is gaining immediate support at the 1.2067 level, and violation of this level exposes the EUR/USD level until the next support area of 1.1992 level. On the 4-hour chart, an upward trendline supports the EUR/USD pair at 1.2067, and below this, the EUR/USD will come under selling pressure. However, holding of EUR/USD over 1.2064 level is keeping the pair bullish. On the 4-hour chart, the EUR/USD pair has closed a bearish engulfing candle which is also adding selling pressure on the pair. The EUR/USD immediate resistance holds at 1.2150 and 1.2178 along with support around 1.2120 and 1.2064. All the best!
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