The EUR/USD currency pair on Thursday bounced off the current 2-month lows to surge above the 1.1000 key level following yesterday’s US rate decision. The currency pair has been trading under intense bearish pressure since the middle of this month.
However, Thursday’s rebound could provide a basis for the bulls to strike thereby triggering a major rebound. The pair is now pegged just below the 100-hour SMA line.
EUR/USD Fundamentals Overview
From a fundamental perspective, the EUR/USD currency pair is trading at the back of a busy period in the US market. On Monday, New Home Sales missed the (MoM) expectation of 0.73M with 0.694M. Durable Goods Orders ex-transportation and ex-defense missed expectations of 0.2% and 0.5%, respectively with -0.1% and -2.5%. On the other hand, nondefense capital goods orders came short of 0% with -0.9%.
On Wednesday, the US pending home sales for December missed the (MoM) expectation of 0.5% with -4.9%. Shortly after, the FOMC took the decision to keep interest rates unchanged at 1.75%. Traders are now looking forward to Thursday’s jobless claims and the preliminary Q4 GDP.
In Europe, the business services sentiment for January missed the expectation of 11.2 ith 11. The business climate also came short of -0.19 with -0.23. On the other hand, the industrial confidence beat -8.7 with -7.3. The economic sentiment indicator beat 101.8 versus 102.8. The unemployment rate also impressed with 7.4 versus 7.5.
EUR/USD Technical Analysis (the 60-min Chart)
Technically, the EUR/USD currency pair appears to have recently completed a head-and-shoulders pattern formation. It continues to trade in a descending channel, which shows a short-term bearish bias. However, the recent rebound could provide the bears with an opportunity to pounce.
Therefore, the bulls will be targeting short-term profits at around 1.1028 or higher at 1.1050 going into Friday. On the other hand, the bears will look to maintain short-term control by targeting profits at around 1.0995 or lower at 1.0975.
EUR/USD Technical Analysis (the Daily Chart)
In the daily chart, the EUR/USD currency pair appears to be trading under considerable bearish pressure. However, the bulls could be trying to take control after the pair bottomed at around 1.0900.
Therefore, the bulls will be targeting long-term profits at around 1.1110 or higher at 1.1206. On the other hand, the bears will look to retain control by targeting profits at around 1.0943 or lower at 1.0853.