On Wednesday, the EUR/USD currency pair pulled back from the session highs of about 1.1265 to trade at about 1.1174. The currency pair also completed a downward breakout from an ascending channel formation in the 60-minute chart.

The pair has now fallen to trade slightly below the 100-hour moving average line. As a result, the currency pair has since recovered from the overbought 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 Wednesday, Germany’s harmonised index of consumer prices for April was unchanged from March at 0.5%, in line with forecasts. The (YoY) equivalent also matched the expectation of 2.2%, unchanged from the previous period.

On Tuesday, Germany’s ZEW survey for the current situation in May missed the forecast of -77 with a reading of -82, while the ZEW survey for economic sentiment for the period beat 11.9 with 25.2. The EU’s ZEW survey for economic sentiment in May also exceeded -3.5 with a reading of 11.6.

In the U.S. the consumer price index for April increased to 0.2% (MoM) from -0.1% in March, missing the forecast of 0.3%. The (YoY) equivalent fell to 2.3%, down from 2.4%, below the forecast of 2.4%. The consumer price index ex-food and energy for the period also fell short of the (MoM) forecast of 0.3% with 0.2%, up from 0.1% in March, while the (YoY) equivalent was in line with the estimate of 2.8%, unchanged from the previous period.

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

Technically, the EUR/USD currency pair has completed a downward breakout from an ascending channel formation in the 60-minute chart. The 14-hour RSI has also recovered from overbought conditions.

Therefore, the bears will look to extend the current pullback towards 1.1089 or lower to 1.1007. On the other hand, the bulls will look to pounce on profits at about 1.1265 or higher at 1.1338.

EUR/USD Technical Analysis (the Daily Chart)

In the daily chart, the EUR/USD currency pair trades within a descending channel formation. The 14-day RSI has also pulled back to recover from overbought conditions.

Therefore, the bears will target extended declines at about 1.0950 or lower at 1.0731. On the other hand, the bulls will look to pounce on rebounds at about 1.1361 or higher at 1.1573.