EUR/USD Mid-Session Technical Analysis for March 18, 2021

The Euro is trading lower on Thursday in a volatile session. A spike in U.S. bond yields overnight boosted the greenback, and drove the single-currency lower after it touched a two-week high. Traders continue to push yields higher after the Federal Reserve Chairman Jerome Powell seemingly supported the notion of higher rates in yesterday’s post-central bank meeting press conference.

At 12:50 GMT, the EUR/USD is trading 1.1927, down 0.0054 or -0.45%.

Powell dampened speculation the stronger economic outlook could propel the central bank to wind back its stimulus. In fact, the Fed now sees the U.S. economy growing 6.5% this year, which would be the largest annual jump in gross domestic product since 1984. Inflation is expected to exceed the Fed’s 2% target to 2.4% this year, although officials think it will move back to around 2% in subsequent years.

Overnight, the U.S. 10-year Treasury yield rose to their highest levels in 13 months, climbing above 1.70% for the first time since January 24, 2020.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1990 will change the main trend to up. A move through 1.1882 will signal a resumption of the downtrend.

On the upside, resistance is a minor 50% level at 1.1974, followed by a retracement zone at 1.2010 to 1.2074.

The new minor range is 1.1836 to 1.1990. Its 50% level at 1.1913 is potential support.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD on Thursday is likely to be determined by trader reaction to 1.1913.

Bullish Scenario

Holding above the pivot at 1.1913 will indicate the presence of buyers. If this generates enough upside momentum then look for a possible retest of 1.1974 and 1.1989.

Taking out 1.1990 will change the main trend to up. This could trigger a surge into 1.2010 to 1.2074.

Bearish Scenario

A sustained move under 1.1913 will signal the presence of sellers. Taking out 1.1882 will indicate the selling pressure is getting stronger. This could trigger an extension of the break into 1.1836, followed by the November 23, 2020 main bottom at 1.1800.

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