#EURUSD @ 1.07322 lacks momentum after rising to eight-month high. (Pivot Orderbook analysis)

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]

• EUR/USD lacks momentum after rising to eight-month high.
• US Dollar rebounds despite softer US data on Fed Chair Powell’s hesitance to provide monetary policy clues.
• ECB policymaker appears hawkish but World Bank’s signal for recession probes them.
• China inflation decorates calendar, highlighting risk catalysts as the key.

The pair currently trades last at 1.07322.

The previous day high was 1.0761 while the previous day low was 1.0639. The daily 38.2% Fib levels comes at 1.0714, expected to provide support. Similarly, the daily 61.8% fib level is at 1.0686, expected to provide support.

EUR/USD treads waters around 1.0740 during the early hours of Wednesday’s Asian trading, after portraying a sluggish performance on Tuesday, as traders await the key catalysts for clear directions. Among them, the US Consumer Price Index (CPI) for December gains major attention.

The quote’s latest inaction could be linked to the US Dollar’s ability to hold the ground despite softer prints of the second-tier data. That said, the US NFIB Business Optimism Index for December dropped to the lowest levels since 2013 if ignoring multiple jitters during the global Covid wave. Further, US Wholesale Inventories also remained unchanged with 1.0% growth for November.

The reason for the US Dollar’s strength could also be linked to Federal Reserve Chair Jerome Powell’s hesitance at Riksbank’s International Symposium on Central Bank Independence in offering further clarity on the US central bank’s monetary policy outlook. However, Federal Reserve Governor Michelle Bowman appeared hawkish while stating that more rate rises are needed to combat high inflation.

On the other hand, European Central Bank’s (ECB) governing council member Mario Centeno said on Tuesday the current process of interest rate increases is approaching its end. However, another ECB Governing Council member Isabel Schnabel highlighted the need for a restrictive monetary policy stance.

It’s worth noting that the World Bank’s grim economic forecasts and expectations of upcoming recession also seemed to have probed the EUR/USD traders. That said, the World Bank stated that it expects the global economy to grow by 1.7% in 2023, down sharply from 3% in June’s forecast, as reported by Reuters.

Amid these plays, the US 10-year Treasury yields rose 10 basis points (bps) to 3.61% and put a floor under the US Dollar even if Wall Street managed to close on the positive side.

Moving on, EUR/USD traders will pay attention to the risk catalysts amid a dearth of major data/events on the calendar ahead of Thursday’s US Consumer Price Index (CPI) data. However, today’s China inflation numbers may entertain intraday traders.

EUR/USD portrays a Doji candlestick at the multi-month high, which in turn joins nearly overbought RSI levels to tease sellers unless the quote stays below 1.0760.

Technical Levels: Supports and Resistances

EURUSD currently trading at 1.0735 at the time of writing. Pair opened at 1.0731 and is trading with a change of 0.04% % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.0626, 50 SMA 1.0427, 100 SMA @ 1.0157 and 200 SMA @ 1.0312.

The previous day high was 1.0761 while the previous day low was 1.0639. The daily 38.2% Fib levels comes at 1.0714, expected to provide support. Similarly, the daily 61.8% fib level is at 1.0686, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.066, 1.0589, 1.0538
• Pivot resistance is noted at 1.0782, 1.0832, 1.0903

[/s2If]
Join Our Telegram Group