On August 8, the U.S. saw mixed economic data that had a notable impact on major currency pairs. Unemployment claims came in at 233K, better than the forecasted 241K, indicating a stronger labor market.
However, this was offset by stagnant final wholesale inventories, which held steady at 0.2%, and a lower-than-expected natural gas storage figure of 21B, compared to the forecast of 22B.
The 30-year bond auction yielded 4.31%, slightly below previous levels, reflecting some uncertainty in long-term U.S. economic outlooks. These events contributed to minor fluctuations in the Dollar Index, which hovered around 103.180, down 0.03%.
Looking ahead to August 9, the German Final CPI is expected to remain steady at 0.3% m/m, which could provide some support for the euro if the forecast holds. Additionally, the Italian Trade Balance is forecasted at €5.55B, down from €6.43B previously, which might weigh on the euro.
These factors, along with the Dollar Index’s position near key technical levels, will likely dictate short-term movements in EUR/USD and GBP/USD.
A break above $103.298 could shift momentum to the upside, while remaining below this level may sustain the bearish trend.
The EUR/USD is trading at $1.09223, up 0.04% for the day. The 4-hour chart shows the pair holding above the pivot point at $1.09211, indicating potential bullish momentum. Immediate resistance is at $1.09550, with further resistance levels at $1.10094 and $1.10547.
On the downside, support is found at $1.08925, followed by $1.08647 and $1.08267. The 50-day EMA at $1.08960 supports the bullish outlook, while the 200-day EMA at $1.08514 provides additional support.
A break below $1.08925 could trigger a sharp selling trend, reversing the current bullish bias.
Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.