EUR/USD Extends Weekly Losses Towards 1.0920 After Data

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The EUR/USD currency pair on Wednesday extended the current weekly losses towards 1.0920 following the latest round of economic data. The currency pair has been on a downward movement since peaking mid-way the recovery trend just below the 61.80% Fib level at 1.1147.

The pair is now finding support off the 200-hour SMA while the 100-hour SMA acts as a solid short-term resistance level. The pair is also close to dropping down into the oversold level of the 60-min RSI.

EUR/USD Fundamentals Overview

From a fundamental perspective, the EUR/USD currency pair is trading at the back of a relatively busy period in the market. The coronavirus pandemic has been setting the tone for the direction that markets will take over the last few weeks. This has increased volatility amid country lockdowns and social distancing. The latest economic data appears to favor the US slightly after the release of the ISM Manufacturing PMI.

On Wednesday, the ISM Manufacturing PMI for March outperformed the expectation of 45 with 49.1. The ISM Manufacturing Employment Index also came out better than expected with 43.8 versus 43.6. However, Markit Manufacturing PMI missed 49.2 with 48.5 while ISM Manufacturing Prices Paid and New Orders Index missed 41.2 and 50.2 with 37.4 and 42.2, respectively. Construction Spending also disappointed with -1.3% versus an expectation of 0.6% while the ADP employment change beat -150k with -27k. 

In the EU, the preliminary core CPI for March missed the (YoY) expectation of 1.2% with 1.0% while the general CPI of 0.7% was also short of 0.8% expected. The Markit Manufacturing PMI for March was also short of expectations while the e=unemplyment rate impressed at 7.3% versus 7.4% expected.

EUR/USD Technical Analysis (the 60-min Chart)

Technically, the EUR/USD currency pair appears to have recently dropped out of an ascending channel. This indicates an attempt by the bears to reverse bullish market sentiment. The latest pullback has pushed the pair closer to oversold levels of the 60-min RSI. This could trigger the next rebound.

The bulls will target short-term rebound profits at around 1.0998 or higher at 1.1069. On the other hand, the bears will look to extend losses towards 1.0857 or lower at 1.0795.

EUR/USD Technical Analysis (the Daily Chart)

In the daily chart, the EUR/USD currency pair appears to have recently pulled back off an attempt to recover from a major plunge. The pair is now trading just below the 38.20% Fib level after the recent pullback.

The bears will look to target profits at around 0.0% Fib level at 1.0641 or slightly higher at 1.0781. On the other hand, the bulls will target rebound profits at around 50% Fib level at 1.1070 or higher at 61.80% Fib level at 1.1164.

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