EUR/USD Mid-Session Technical Analysis for April 16, 2020

The Euro is trading lower against the U.S. Dollar on Thursday as investors await the release of the U.S. Weekly Unemployment Claims report. Economists are looking for the report to show another 5 million Americans lost their jobs last week.

Last Thursday, the U.S. reported 6.61 million initial claims. That print brought total claims over the three weeks prior to more than 16 million, implying that about 10% of the U.S. workforce had filed for unemployment benefits over that time.

At 12:22 GMT, the EUR/USD is trading 1.0889, down 0.0023 or -0.21%.

Another round of disappointing data is likely to drive up demand for the U.S. Dollar due to its safe-haven qualities. On Wednesday, the dollar spiked higher against a basket of currencies following disappointing retail sales and manufacturing reports.

In other news, U.S. President Donald Trump is due to announce guidelines on re-opening the country’s economy at a press conference later on Thursday, which could also boost market sentiment.

Additionally, a half-trillion-Euro compromise deal struck between Euro Zone governments last week to support countries through the coronavirus outbreak may prove insufficient.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.0991 will change the main trend to up. A move through the last swing bottom at 1.0768 will signal a resumption of the downtrend.

The minor range is 1.1147 to 1.0768. Its retracement zone at 1.0958 to 1.1002 is resistance. This zone stopped the rally at 1.0991 on Wednesday.

The short-term range is 1.0636 to 1.1147. Its retracement zone at 1.0892 to 1.0831 is currently being tested. This zone is potential support. It is controlling the near-term direction of the EUR/USD.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.0889, the direction of the EUR/USD the rest of the session on Thursday is likely to be determined by trader reaction to the 50% level at 1.0892.

Bullish Scenario

Look for a counter-trend rally to develop on a sustained move over 1.0892 with possible upside targets coming in at 1.0958, 1.0991 and 1.1002.

Bearish Scenario

A sustained move under 1.0892 will signal the presence of sellers. The first downside target is a Fibonacci level at 1.0831. This is a potential trigger point for an acceleration into the last main bottom at 1.0768.

Side Notes

In breaking news, the U.S. reported weekly jobless claims of 5.245 million, slightly above the estimate. Traders are showing little reaction to the news so far.