EUR/USD Price Forecast – EUR/USD To Continue Range Bound Action Below Mid -1.12 Handle

The EURUSD pair traded range bound during the first half of yesterday’s trading session as caution ahead of European Central Bank’s interest rate decision and monetary policy committee press conference limited trading activity in the market. Even during the cautions trading activity ahead of ECB update, when both sides of the currency pair were trying to gain an upper hand, strong USD was slowly dragging the pair towards the downside. Following ECB update which saw forward guidance take a highly dovish tone than expected, the pair breached multiple resistance and fell to new yearly lows at 1.11762 handle -a price level not seen since June 2017.

US NFP Eyed For Fundamental Support As ECB Update Provided Directional Bias

Yesterday’s slide saw the pair make a clean break through multiple support price levels breaking away even from multi-month long wider price range limitations pointed out in my article yesterday. Following, the sharp slide however the pair had managed to rebound from previous session lows in Pacific-Asian market hours and seems to have moved back above 1.1200 handle where the pair has maintained a rangebound price action. This move clearly hints that the pair has now found a directional bias. Given the fact that ECB has announced the month of September 2019 as the debut for their latest TLTRA plans and reduced growth and inflation forecast for the year ahead, fundamentals provide a strong bearish influence to EURO in short to medium term outlook for EURO.

As of writing this article, EURUSD pair is trading at 1.1206 up by 0.13% on the day. Investors are now on the lookout for macro data updates for short term profit opportunities. While European macro calendar remains silent for the day aside from German factory orders data which is expected to see a positive outcome, US calendar is tightly packed with key macro data updates that could help USD gain enough strength to sustain an ongoing rally for quite a while depending on the outcome. US macro calendar is expected to Building Permits, Non-Farm Payroll, Unemployment rate, and Average hourly earnings index data. A dovish outcome in US macro data will help EURO bulls move back near mid-1.12 handle ahead of which the pair is likely to continue rangebound price action and in case of positive US macro data outcome the pair will fall below 1.1200 handle making the long term support price levels of 1.1211 & 1.1233 a key resistance handle and support at 1.1150 & 1.1120 respectively.

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