EUR/USD Price Analysis – March 22, 2023
Daily Price Outlook
The EUR/USD currency pair is currently trading at around 1.0770. Following a four-day increase, the pair has stabilized as buyers take a breather at the highest levels seen in five weeks on the day of the Federal Reserve (Fed) decision.
German ZEW Economic Sentiment
The March 2023 ZEW Index of Economic Sentiment poll for Germany in the Eurozone shows a significant decline. The Economic Sentiment Index dropped in March to 13.0 from 28.1 in January, falling short of the 14.9 market estimate. Meanwhile, the ZEW Economic Sentiment Index for the Eurozone also fell from 29.7 to 10.0, below the forecast of 23.2.
Despite the negative reports, market sentiment remains positive, with traders more focused on the banking industry's improvements. As a result, the bulls on the EUR/USD pair remain unaffected by the weak ZEW polls.
Eyes on FOMC Today
The US Existing House Sales for February surged by 14.5%, exceeding the predicted 0.0%. However, the positive effect on the US Dollar was dampened by the Philadelphia Fed Non-Manufacturing Business Outlook survey indicator, which fell to -12.8 in March.
Nevertheless, the focus was on the anticipated rate hike by the Fed and the ongoing banking issue, overshadowing the economic data. International markets experienced a risk-off sentiment in recent days but were relieved on Tuesday as US authorities' efforts to contain the financial crisis received market support.
US Treasury Secretary Janet Yellen's statement reduced worries about additional banking instability by stating that the Federal Reserve's new Bank Term Funding facility and discount window loans are supplying liquidity to the banking sector.
The FOMC meeting started its two-day discussion on Tuesday, with a 25 bps rate hike expected, along with demands for no change or even a rate cut. As a result, US 10-year yields traded lower before the meeting at 3.581%, and the DXY stood at 103.20. Despite the flat dollar, the EUR/USD is moving upwards.
The FOMC meeting will be the main focus on Wednesday, and traders must prepare for significant price fluctuations throughout the American session.
EUR/USD Intraday Technical Levels
Support Resistance
1.0717 1.0802
1.0668 1.0838
1.0632 1.0888
Pivot Point: 1.0753
EUR/USD – Technical Outlook
The EUR/USD pair has confirmed a break of the 1.0745 level by finishing the daily candlestick above it, providing further evidence of the intraday and short-term positive trend. Our next positive targets range from 1.0800 to 1.0900.
The price is being supported from below by the EMA50, however temporary sideways movements owing to stochastic negativity may occur before the projected bullish wave resumes. However, breaking the 1.0745 level will put an end to the positive scenario and send the price into a bearish correction, with targets starting at 1.0680 before any new attempt to advance.
Today's trading range is predicted to be between the support level of 1.0710 and the resistance level of 1.0870.
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* GOLD Price Analysis – March 22, 2023
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