EUR/USD Daily Forecast – Euro Attempts To Gain More Ground Against U.S. Dollar

EUR/USD Video 21.05.21.

U.S. Dollar Is Mostly Flat Against Euro

EUR/USD continues its attempts to settle above the resistance at 1.2220  while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle below the support at 89.75. If this attempt is successful, the U.S. Dollar Index will move towards the next support level at 89.50 which will be bullish for EUR/USD.

Today, foreign exchange market traders will take a look at Euro Area flash PMI data. Analysts expect that Manufacturing PMI declined from 62.9 in April to 62.5 in May. Services PMI is projected to improve from 50.5 to 52.3. Numbers above 50 show expansion.

U.S. will also release flash PMI reports which are expected to show that Manufacturing PMI declined from 60.5 to 60.2 while Services PMI decreased from 64.7 to 64.5. It should be noted that PMI reports stay at strong levels, highlighting the robust recovery of the economy.

Traders will also have a chance to evaluate additional housing market data from U.S. Existing Home Sales are expected to grow by 2% month-over-month in April after declining by 3.7% in March.

Technical Analysis

EUR/USD continues to test the resistance at 1.2220. In case EUR/USD manages to settle above this level, it will move towards the resistance at 1.2250.

A move above the resistance level at 1.2250 will push EUR/USD towards the next resistance at 1.2280. If EUR/USD settles above the resistance at 1.2280, it will head towards the resistance level which is located at 1.2310.

On the support side, the nearest support level for EUR/USD is located at 1.2175. Recent trading sessions indicated that no important levels were formed between 1.2175 and 1.2220. If EUR/USD develops downside momentum, it may quickly get back to the support at 1.2175.

A successful test of the support at 1.2175 will open the way to the test of the next support at 1.2155. In case EUR/USD declines below this level, it will move towards the support which is located at the 20 EMA at 1.2130.

For a look at all of today’s economic events, check out our economic calendar.