EUR/USD Mid-Session Technical Analysis for February 10, 2021

The Euro is trading higher against the U.S. Dollar on Wednesday after hitting its highest level since January 29 earlier in the session. The single-currency is now in a position to post its fourth straight higher close since the release of weaker-than-expected U.S. labor market data last Friday.

Other catalysts behind the move include increased demand for riskier assets, the view that the U.S. economy may not be as strong as previously thought and expectations of additional stimulus from the federal government.

At 13:56 GMT, the EUR/USD is trading 1.2134, up 0.0013 or +0.11%.

In economic news, U.S. consumer prices rose moderately in January and underlying inflation remained benign as the pandemic continues to be a drag on the labor market and services industry.

In other news, Euro Zone states must keep fiscal spending up this year and into 2022 to protect the bloc from permanent damage caused by the coronavirus pandemic, European Central Bank President Christine Lagarde said in an online interview with the Economist on Wednesday. Lagarde also called on European Union leaders to kick start the bloc’s 750 billion Euro Next Generation EU spending package as some economic restrictions could remain in place until the second half of the year.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, but momentum has been trending higher since Friday’s closing price reversal bottom. A trade through 1.1952 will negate the chart pattern and signal a resumption of the downtrend. A move through 1.2190 will change the minor trend to up.

The nearest support is a short-term Fibonacci level at 1.2099, followed by a prices cluster at 1.2074 to 1.2071. This is followed by the main Fibonacci level at 1.2010.

The short-term range is 1.2349 to 1.1952. Its retracement zone at 1.2151 to 1.2197 is the next upside target area.

Daily Swing Chart Technical Forecast

The early price action suggests the direction of the EUR/USD into the close is likely to be determined by trader reaction to 1.2151.

Bullish Scenario

A sustained move over 1.2151 will indicate the presence of buyers. If this is able to generate enough upside momentum then look for the rally to possibly extend into 1.2190, followed by 1.2197.

Bearish Scenario

The inability to overcome 1.2151 will signal the presence of sellers. This could trigger a quick break into 1.2099. If this fails then look for the weakness to extend into 1.2074 to 1.2071. Buyers could come in on a test of this area.

Taking out 1.2071 will indicate the selling is getting stronger. This could trigger an acceleration to the downside with 1.2010 the next likely target.

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