Key Highlights
- The Euro recovered recently and broke the 1.1350 resistance against the US Dollar.
- There was a break above a crucial bearish trend line with resistance at 1.1295 on the 4-hours chart of EUR/USD.
- The German IFO Business Climate Index declined from 99.3 to 98.5 in Feb 2019.
- The US Wholesale Inventories for Dec 2018 will be released today, which could increase 0.2%.
EURUSD Technical Analysis
The Euro formed a strong support near the 1.1250 level and bounced back against the US Dollar. The EUR/USD pair traded above the 1.1300 and 1.1350 resistance levels to move into a positive zone.
Looking at the 4-hours chart, the pair gained pace once it broke the 1.1300 resistance and the 23.6% Fib retracement level of the last decline from the 1.1514 high to 1.1236 low. The pair even climbed above the 1.1350 resistance, but it faced a strong resistance near the 1.1380 zone.
Moreover, the 50% Fib retracement level of the last decline from the 1.1514 high to 1.1236 low along with the 100 (red) simple moving average (4-hours) also prevented gains.
The current price action is neutral-to-bearish, with supports near the 1.1300 and 1.1280 levels. On the upside, a successful close above the 1.1375 and 1.1380 resistance levels could open the doors for a push towards the 1.1450 level.
Fundamentally, the German IFO Business Climate Index for Feb 2019 was released recently. The market was looking for a minor decline from the last reading of 99.1 to 99.0.
However, the result was mixed as there was a decline to 98.5, but the last reading was revised up from 99.1 to 99.3. Looking at the Expectations Index, there was a decline from 94.2 to 93.8.
Overall, the EUR/USD pair might struggle to climb above the 1.1380 resistance and it could correct a few pips before a fresh rise above 1.1400 in the coming sessions.
Economic Releases to Watch Today
- US Wholesale Inventories for Dec 2018 – Forecast +0.2%, versus +0.3% previous.
- Chicago Fed National Activity Index for Jan 2019 – Forecast 0.26, versus 0.27 previous.
