#EURUSD @ 0.97870 US dollar under pressure for the second day in a row. (Pivot Orderbook analysis)

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• US dollar under pressure for the second day in a row.
• Wall Street off lows, Treasuries erase losses and DXY drops by 0.50%.
• EUR/USD looking at 0.9800, technical favor more gains.

The pair currently trades last at 0.97870.

The previous day high was 0.9751 while the previous day low was 0.9536. The daily 38.2% Fib levels comes at 0.9669, expected to provide support. Similarly, the daily 61.8% fib level is at 0.9618, expected to provide support.

The EUR/USD is trading at the highest level since last Wednesday slightly below the 0.9800 mark. It is up by more than 250 pips from Wednesday low as it continues to recovery on the back of a weaker US dollar.

The greenback is suffering as Wall Street moves off lows and also as US yields approach daily lows. Another negative for the dollar is the recovery of the offshore Chinese yuan that is having the best day in months with USD/CNH below 7.10.

Despite most of the current forecasts projecting the EUR/USD to move south over the next weeks to fresh multi-year lows, the pair is rising for the second day in a row on Thursday, accumulating a gain of more than 200 pips. The impact of Bank of England’s surprise announced on Wednesday (temporary purchase of long-term gilts at whatever scale is necessary) is still being digested by market participants.

The dollar received a brief and short-lived relief earlier on Thursday following the release of US economic data that confirmed a 0.6% GDP contraction during the second quarter and a larger-than-expected decline in initial jobless claims to the lowest level in months below 200K.

Fed officials continue to point toward more rate hikes. Bullard argued the rates will likely be at higher levels for a longer period of time. Mester said inflation remains the main economic problem. The US central bank is expected to continue rising rates with odds favoring a 75 basis points rate hike in November.

The European Central Bank is also expected to continue rising rates further as inflation remains at decade highs. According to preliminary data released on Thursday, the Consumer Price Index in Germany reached 10% in September, the first time 70 years to hit double digits.

Short-term technical indicators favor the upside. More gains seem likely while above 0.9750. The positive tone would be affected with a slide back under 0.9640 (20-Simple Moving Average in four-hour charts). On the upside, the next resistance is the 0.9800/05 area, followed by a stronger barrier around 0.9880.

Technical Levels: Supports and Resistances

EURUSD currently trading at 0.9772 at the time of writing. Pair opened at 0.9735 and is trading with a change of 0.38 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.9908, 50 SMA 1.0048, 100 SMA @ 1.0257 and 200 SMA @ 1.067.

The previous day high was 0.9751 while the previous day low was 0.9536. The daily 38.2% Fib levels comes at 0.9669, expected to provide support. Similarly, the daily 61.8% fib level is at 0.9618, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.9596, 0.9458, 0.9381
• Pivot resistance is noted at 0.9812, 0.9889, 1.0027

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