The EUR/USD currency pair on Friday pulled back to trade at a new 3-week low of about 1.2094 after the latest round of US data. The currency pair continues to trade within a gently descending channel formation in the 60-min chart.
The pair now trades several levels below the 100-hour moving average following today’s pullback. The currency pair dropped to the oversold levels of the 14-hour RSI before bouncing back later to the normal trading zone.
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 US market. As the G7 meeting continued on Friday, the preliminary Michigan Consumer Sentiment for June came in strongly at 86.4 compared to the expectation of 84.
On Thursday, the US consumer price index ex-food and energy rose 3.8% (YoY). The market was expecting a change of 3.4%. The (MoM) equivalent rose 0.7% compared to an expected change of 0.4%. On the other hand, general CPI increased 5% (YoY) versus the projected increase of 4.7%. It also increased 0.6% (MoM) versus an expectation of 0.4%. The initial jobless claims missed 370k with a count of 376k.
In the EU, the ECB decided to keep the base interest rate unchanged at 0.0%. The deposit rate also remained pinned at -0.5%, both in line with expectations.
EUR/USD Technical Analysis (the 60-min Chart)
Technically, the EUR/USD currency pair appears to be trading within a gently descending channel formation in the 60-min chart. This indicates a slight short-term bearish bias in the market sentiment. The currency pair sank to overbought levels before bouncing back later on Friday.
The bulls will be looking to boost the current rebound by targeting profits at around 1.2146 or higher at 1.2191. On the other hand, the bears will look to extend the current pullback to 1.2064 or lower to 1.2020.
EUR/USD Technical Analysis (the Daily Chart)
In the daily chart, the EUR/USD currency pair appears to be trading within an ascending channel formation. The pair recently pulled back to avoid crossing to the overbought levels of the 14-day RSI. It retains a long-term bullish bias.
The bulls will be looking to ride the current bull run by targeting profits at around 1.2244 or higher to 1.2397. On the other hand, the bears will look to pounce for potential pullbacks at 1.1955 or lower at 1.1803.