The EUSR/USD currency pair on Friday pulled back off the current 18-month highs of about 1.1624 to trade at about 1.588 after the latest round of EU PMIs. The currency pair has been trading within an ascending curve amid increasing bullish pressure.
Friday’s pullback prevented it from reaching overbought levels in the 14-hour RSI in the 60-min chart. The currency pair continues to trade well above the current levels of the 100-hour and the 200-hour SMA lines.
EUR/USD Fundamentals Overview
From a fundamental perspective, the EUR/USD currency pair is trading at the back of a relatively busy period in both markets. On Wednesday, the US housing price index missed the (MoM) expectation for May with -0.3% versus 0.3%. Existing home sales and home sales change for June also came short of the (MoM) expectations of 4.78M and 24.5%, respectively with 4.72M and 20.7%. On Thursday, initial jobless claims for the week ending July 17 missed the expectation of 1.3M with 1.416M. On the other hand, continuing claims were lower than expected at 16.197M versus 17.067M.
In the EU, the preliminary consumer confidence for July missed -12 with -15. On Friday, the preliminary EU Markit manufacturing PMI for July beat 50 with 51.1. The services PMI also outperformed 51 with 55.1 while the PMI composite outshone 51.1 with 54.8. Traders will be looking forward to the preliminary US Markit PMIs for July later in the day.
EUR/USD Technical Analysis (the 60-min Chart)
Technically, the EUR/USD currency pair appears to be trading within a sharply ascending curve in the 60-min chart. This indicates a strong short-tern bullish bias in the market sentiment. The pair has recently pulled back to avoid crossing to overbought levels of the 14-hour RSI.
The bulls will be looking to extend the current gains towards 18-month highs of 1.1624 or higher at 1.1662. On the other hand, the bears will target short-term pullback profits at around 1.1548 or power at 1.1501.
EUR/USD Technical Analysis (the Daily Chart)
In the daily chart, the EUR/USD currency pair appears to have recovered from an attempted pullback to surge to new 18-month highs. The pair has since crossed to overbought levels of the 14-day RSI.
The bulls will be looking to extend the current long-term rally towards 1.1725 or higher at 1.1833. On the other hand, the bears will look to pounce for pullback profits at around 1.1475 or lower at 1.1457.