EUR/USD Daily Forecast – Resistance At 1.2130 Remains A Major Obstacle On The Way Up

EUR/USD Video 16.02.21.

Euro Tries To Gain More Ground Against U.S. Dollar

EUR/USD remains glued to the nearest resistance level at 1.2130 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently testing the nearest support level at 90.30. A move below this level will push the U.S. Dollar Index towards the support at the 90 level which will be bullish for EUR/USD.

Yesterday, EU reported that Euro Area Industrial Production decreased by 1.6% month-over-month in December compared to analyst consensus which called for a decline of 1%. On a year-over-year basis, Industrial Production declined by 0.8%.

Today, foreign exchange market traders will have a chance to evaluate additional economic data from EU. The second estimate of the fourth-quarter GDP Growth Rate is expected to show that GDP declined by 0.7% quarter-over-quarter. On a year-over-year basis, GDP is projected to decrease by 5.1%.

Meanwhile, ZEW Economic Sentiment Index is expected to decline from 58.3 in January to 57 in February. The European currency may be especially sensitive to economic sentiment data as traders remain focused on the speed of the economic recovery in the Euro Area.

Technical Analysis

The technical picture for EUR/USD remained stable in recent trading sessions. EUR/USD continues its attempts to settle above the nearest resistance level at 1.2130 but is not able to develop additional upside momentum in order to get to the test of the next resistance at 1.2155.

RSI remains in the moderate territory so there is plenty of room to gain momentum, but it looks like EUR/USD needs additional catalysts to test the resistance at 1.2155.

If EUR/USD settles above 1.2155, it will move towards the resistance at 1.2175. A successful test of this level will push EUR/USD towards the resistance at 1.2220.

On the support side, a move below 1.2130 will open the way to the test of the support which is located at the 50 EMA at 1.2110. If EUR/USD declines below this level, it will move towards the support at 1.2080. A successful test of the support at 1.2080 will push EUR/USD towards the support at 1.2060.

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