EUR/USD Daily Forecast – U.S. Dollar Is Under Some Pressure Against Euro

Euro Gains Ground Against U.S. Dollar

EUR/USD is trying to get back above the resistance at 1.1880 while the U.S. dollar is losing some ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to move below the support at the 92 level. In case this attempt is successful, it will get to the test of the 50 EMA at 91.90 which will be bullish for EUR/USD.

Today, foreign exchange market traders will focus on Producer Prices data from EU. Analysts expect that Euro Area Producer Prices increased by 1.4% month-over-month in June. On a year-over-year basis, Euro Area Producer Prices are projected to grow by 10.3%.

Traders will also keep an eye on the latest developments in U.S. government bond markets. The yield of 10-year Treasuries has recently made an attempt to settle below 1.15% as bond traders continued to ignore inflation risks and rushed to buy U.S. government bonds.

Lower yields may ultimately put additional pressure on the American currency, although it remains to be seen whether this pressure will be significant as U.S. dollar continues to get some support as a safe-haven asset amid worries about the new wave of coronavirus.

Technical Analysis

EUR/USD continues its attempts to settle above the resistance level at 1.1880. If EUR/USD manages to settle above this level, it will get to the test of the next resistance which is located at the 50 EMA at 1.1895.

A move above the 50 EMA will open the way to the test of the resistance at 1.1925. In case EUR/USD moves above this level, it will head towards the resistance at 1.1945. A successful test of this level will push EUR/USD towards the resistance at 1.1965.

On the support side, the nearest support level for EUR/USD is still located at 1.1860. In case EUR/USD declines below this level, it will move towards the 20 EMA at 1.1845. A move below this level will push EUR/USD towards the next resistance at 1.1830.

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