Euro Moves Higher Ahead Of ECB President Lagarde Speech

Euro Moves Higher Against U.S. Dollar

EUR/USD is currently trying to get to the test of the resistance at the 50 EMA at 1.1355 while U.S. dollar is under pressure against a broad basket of currencies.

The U.S. Dollar Index is moving towards the support level at 95.75. In case the U.S. Dollar Index declines below this level, it will get to the test of the 50 EMA at 95.65 which will be bullish for EUR/USD.

Yesterday, EU reported that Euro Area Unemployment Rate declined from 7.3% in October to 7.2% in November, in line with the analyst consensus.

Today, foreign exchange market traders will focus on ECB President Lagarde’s speed and Fed Chair Powell’s testimony. The Fed has recently sent hawkish signals, while ECB remained mostly dovish. In case ECB highlights the threat from inflation and shows that it is ready to act, EUR/USD may get more support and move out of the current trading range.

Technical Analysis

EUR/USD settled above 1.1330 and is heading towards the next resistance level which is located at the 50 EMA at 1.1350. In case EUR/USD manages to settle above this level, it will head towards the next resistance level at 1.1370.

A move above the resistance at 1.1370 will open the way to the test of the resistance at 1.1390. If EUR/USD gets above this level, it will head towards the resistance at 1.1420.

On the support side, the previous resistance at the 20 EMA will serve as the first support level for EUR/USD. If EUR/USD declines below the 20 EMA, it will head towards the next support at 1.1300. A successful test of the support level at 1.1300 will open the way to the test of the support at 1.1270.

From a big picture point of view, EUR/USD needs to get out of the recent 1.1270 – 1.1370 range to have a chance to gain sustainable momentum. In case EUR/USD stays within this range, it will continue to move back and forth without clear direction.

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