On Thursday, the EUR/USD currency pair pulled back from the session highs of about 1.1350 to trade at about 1.1267. The currency pair trades within a descending channel formation in the 60-minute chart.
The pair has now plummeted to trade at the 100-hour moving average line. As a result, the currency pair is on the verge of entering the oversold levels of the 14-hour RSI.
EUR/USD Fundamentals Overview
From a fundamental perspective, the EUR/USD currency pair trades during a relatively busy period in both markets. On Thursday, the U.S. initial jobless claims for the week ending May 16 improved to 227k, down from 229k in the preceding week, beating the forecasted claim count of 230k.
The preliminary S&P Global Manufacturing PMI for May also beat the forecast of 50.1 with a reading of 52.3, up from 50.2, while the preliminary S&P Global Services PMI improved to 52.3, up from 50.8, beating the forecast of 50.8. The preliminary S&P Global Composite PMI for the period rose to 52.1 up from 50.6.
In the EU, Germany’s preliminary HCOB Manufacturing PMI missed the expectation of 48.9 with a reading of 48.8, while the preliminary HCOB Services PMI fell short of 49.5 with 47.2. On the other hand, the preliminary HCOB composite PMI failed to match the estimate of 50.4 with a reading of 48.6.
The EU economic block’s preliminary HCOB Manufacturing PMI for May outshone the forecast of 49.3 with a reading of 49.4. The preliminary HCOB Services and Composite PMIs for the period missed 50.3 and 50.7, with readings of 48.9 and 49.5, respectively.
EUR/USD Technical Analysis (the 60-min Chart)
Technically, the EUR/USD currency pair trades within a descending channel formation in the 60-minute chart. The 14-hour RSI also supports a bearish bias as it edges closer to oversold conditions.
Therefore, the bears will look to extend the current pullbacks toward 1.1220 or lower to 1.1171. On the other hand, the bulls will look to pounce on rebounds at about 1.1314 or higher at 1.1361.
EUR/USD Technical Analysis (the Daily Chart)
In the daily chart, the EUR/USD currency pair has recently completed an upward breakout from a descending channel formation. The 14-day RSI also supports a bullish bias after bouncing back to move towards overbought conditions.
Therefore, the bulls will look to stretch the current rebound towards 1.1423 or higher to 1.1573. On the other hand, the bears will look to pounce on profits at about 1.1100 or lower to 1.0956.