Key Highlights
- EUR/USD topped near 1.2150 and started a downside correction.
- It broke a major bullish trend line with support near 1.2100 on the 4-hours chart.
- The Euro Zone Manufacturing PMI is likely to remain stable at 63.3 in March 2021.
- The US ISM Manufacturing Index could increase from 64.7 to 65.0 in March 2021.
EUR/USD Technical Analysis
This past week, the Euro extended its rise above 1.2100 against the US Dollar. EUR/USD tested the 1.2150 zone, where it faced a strong selling interest.
Looking at the 4-hours chart, the pair started a downside correction from the 1.2150 high. It declined below the 1.2120 and 1.2100 support levels. There was also a break below a major bullish trend line with support near 1.2100.
It traded below the 23.6% Fib retracement level of the main upward move from the 1.1702 swing low to 1.2150 high. The pair is now trading well below 1.2100.
An immediate support is near the 1.2000 zone and the 100 simple moving average (red, 4-hours). The next major support is near the 1.1925 level and the 200 simple moving average (green, 4-hours).
The 50% Fib retracement level of the main upward move from the 1.1702 swing low to 1.2150 high is also near 1.1926. Any more losses might start a strong decline below 1.1900.
On the upside, an initial resistance is near the 1.2080 and 1.2100 levels. The main resistance is now near 1.2150, above which EUR/USD could resume its uptrend.
Looking at GBP/USD, the pair failed to stay above 1.3920 and it started a fresh decline. Besides, USD/JPY climbed above the 109.00 resistance zone.
Economic Releases
- Germany’s Manufacturing PMI for March 2021 – Forecast 66.4, versus 66.4 previous.
- Euro Zone Manufacturing PMI March 2021 – Forecast 63.3, versus 63.3 previous.
- US Manufacturing PMI for March 2021 – Forecast 60.6, versus 60.6 previous.
- US ISM Manufacturing Index for March 2021 – Forecast 65.0, versus 64.7 previous.
