EUR/USD Daily Price Forecast – Fiber Might Find Support Near 1.1135 Monthly Lows

Pessimism around trade talks may further worsen the market sentiment. All the SMAs hovered just above the EUR/USD pair marking an overall bearish outlook.
Nikhil Khandelwal

On Monday morning, the Euro pair had marked the day’s opening near 1.1161 levels. The pair were flirting near the 1.1153 low levels last touched on Friday.

The pair remained calm and subdued amid the Eurozone April CPI figures that came out in-line with the market expectation. There was an uptick recorded on the March Monthly Construction Output data that reported 6.3% over 1.8% estimates. However, upbeat US Michigan Index sliced down all the possibilities for a Euro pair upsurge.

The Italian tensions over breaking the EU Fiscal rules kept the investors intact under worries. Italian Deputy Prime Minister Matteo Salvini continues threats to increase the debt levels of the nation. Salvini proclaimed that his government is all set to elevate the debt ceiling to 140% of the GDP. Any action of this kind can violate the EU fiscal debt norms of around 3% of the GDP. The Deputy Prime Minister said that the EU fiscal rules must undergo modifications and upgrades over time. However, there remained few headlines on that front showing less near-term impacts on the pair movement.

The primary plunge in the pair gets discounted to the healthy growing Greenback. The US Dollar Index stays near 98.03 top monthly levels. The US-Sino trade tensions appeared to go a bit uncertain over the weekend. China remained obnoxious over lack of sincerity from the US counterpart. Trump’s indirect action against the Chinese Giant Company, Huwaei, lead to further pessimism around the trade agreement. The Greenback had uprisen overshadowing the chaos around the trade talks.

EUR/USD Influencing Events

A few moments ago, the Destatis released the German April MoM Producer Price Index. The numbers came out as 0.5% over the consensus estimates of 0.2%. This report signifies a recovery sign for the Fiber to uplift like a Pheonix from the bottom levels.

Over the USD side, today the most significant events are Fed’s Powell speech. The Fed Chair would shed some light over the economic interests rates among the globe. Powell’s statements may impact significantly on the US Dollar Index.

Laterwards the Fed‘s Vice-Chair Richard Clarida would brief over the impacts of increasing interest rates on the US economy. In one of his latest speech, Richard explained that inflation has remained apathetic to the lowering unemployment this time. Hence, the Vice-Chair said that in effect to the growing concerns, the Fed may reduce the interest rates later. Moreover, the Chicago Fed will release the National Activity Index during the afternoon session. This time, the analysts stay bearish over this index, expecting it to come around negative 0.33%.

Technical Analysis

EURUSD 60 Min 20 May 2019

In the 1-hour chart, the price has settled below all of its Simple Moving Averages (SMA). The significant 50-days SMA occurred beneath the other 100-days and 200-days SMAs, referring near term slight bullish momentum. The EUR/USD pair appeared moving within the range of 1.1160/50 levels. And if the Fiber continues to move down ahead, then the next support point near 1.1135 levels awaits. The Central Line of the Bollinger Bands (BB) stood above the pair, alluding bear call.

Moreover, the lower boundary of the BB gathered near 1.1151 levels today. The Fiber, which seems to drop in the lower vicinity of the BB, indicates a bearish prospect among the traders. The Relative Strength Index (RSI) was hovering near 32 levels and alluded heavy selling.

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