EUR/USD Mid-Session Technical Analysis for April 30, 2020

The Euro is trading flat-to-higher on Thursday shortly before the European Central Bank’s (ECB) monetary policy and interest rate decisions. Earlier today, a report showed the Euro Zone economy contracted at a record rate in the first three months of the year and inflation slowed sharply as much economic activity in March came to a halt because of the COVID-19 pandemic. Economists expect even worse numbers for the second quarter.

At 12:01 GMT, the EUR/USD is trading 1.0868, down 0.0009 or -0.09%.

The European Central Bank (ECB) opted to keep its main interest rates unchanged on Thursday, as the Euro Zone faces a deep economic crisis. However it did ease conditions for bank and stress that it is ready to buy more government bonds if needed.

The decision came on the same day revealed the 19-member region’s economy contracted by 3.8% in the first quarter – the lowest reading since records began in 1995 – as the coronavirus pandemic hit business activity in the region hard.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of the closing price reversal bottom at 1.0727 on April 24.

The main trend will change to up on a trade through 1.0991. A move through 1.0727 will signal a resumption of the downtrend.

The main range is 1.0636 to 1.1147. The market is currently trading inside its retracement zone at 1.0892 to 1.0831. This zone is controlling the near-term direction of the EUR/USD.

The short-term range is 1.1147 to 1.0727. Its retracement zone at 1.0937 to 1.0987 is the next potential upside target. With the trend down, sellers could come in on a test of this zone.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.0868, 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

A sustained move over 1.0892 will indicate the presence of buyers. This could trigger an acceleration into the short-term 50% level at 1.0937. This is followed by the short-term Fibonacci level at 1.0987 and the main top at 1.0991.

Bearish Scenario

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