Key Highlights
- The US Dollar after correcting towards the 1.1680 support against the US Dollar found support.
- The EUR/USD pair recovered recently and broke a bearish trend line at 1.1800 on the 4-hours chart.
- The pair bounced from the 100 SMA (H4) and now placed comfortably above 1.1750.
- China’s Retail Sales for Jul 2017 (YoY) reported today posted an increase of 10.4%, less than the forecast of 10.8%.
EURUSD Technical Analysis
The Euro started a downtrend from 1.1910 against the US Dollar. The EUR/USD pair traded as low as 1.1688 and currently attempting to move back in the bullish zone.
Looking at the 4-hours chart of EUR/USD, there is a crucial support near 1.1700-1.1680. It acted as a solid buy zone, and as a result, the pair bounced and recovered above 1.1750. Furthermore, the pair was rejected from the 100 simple moving average (H4) (1.1710).
The pair was able to move above a bearish trend line at 1.1800 on the 4-hours chart. Later, buyers took EUR/USD above the 50% Fib retracement level of the last decline from the 1.1910 high to 1.1688 low.
It is a strong bullish sign and could lift the market sentiment for the Euro, and EUR/USD might continue to move higher towards 1.1850 or 1.1880.
The H4 RSI is now above 50, currently positioned at 62 and moving higher, which is a positive sign.
China’s Retail Sales
Recently in China, the Retail Sales report for July 2017 was released by the National Bureau of Statistics of China. The market was aligned for an increase of 10.8% in sales compared with the same month a year ago.
However, the actual result was a bit on the lower side, as there was an increase of 10.4% in sales. It was also less compared with the last 11%.
Furthermore, China’s industrial output for July 2017 posted a growth of 6.4 percent on-year, down from the last +4.6%. And, the Fixed-asset investment was up by 8.3% (seven months figure) in 2017, which is less than the 8.6% increase in the first half of 2017.
The risk sentiment was dented after the release, and EUR/USD was down by roughly 20-30 pips. However, the pair remains supported on the downside near 1.1780.
