On Wednesday, the EUR/USD currency pair pulled back from the session highs of about 1.1625 to trade at about 1.1599. The currency pair trades within a descending channel formation in the 60-minute chart.

The pair has now fallen to trade several levels below 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 Wednesday, Germany’s HCOB Composite PMI for May beat the expectation of 48.6, with a reading of 48.8. The HCOB Services PMI for the period also outperformed the expectation of 47.8, with a reading of 48.1, while the EU’s HCOB Composite PMI beat 47.5, with a reading of 48.5. 

On the other hand, the EU producer price index for April outperformed the (MoM) expectation of 0.4%, with a change of 0.6%. The (YoY) equivalent also beat the estimated change of 4.8%, with a change of 4.9%.

In the US, the ISM Manufacturing PMI for May exceeded the expectation of 53, with a reading of 54. The ISM Manufacturing Prices Paid for the period missed the expected reading of 85.5, with a reading of 82.1. 

US JOLTS Job Openings for April came in stronger than expected, with 7.618 million versus a forecast of 6.88 million, up from 6.887 million. The ADP Employment Change for April also beat the expectation of 117k, with a change of 122k, up from the previous month’s equivalent of 105k.

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 stretch the current run of declines toward 1.1570 or lower to 1.1541. On the other hand, the bulls will look to pounce on rebounds at about 1.1625 or higher at 1.1652.

EUR/USD Technical Analysis (the Daily Chart)

In the daily chart, the EUR/USD currency pair trades within a descending channel formation. However, the 14-day RSI still has some room left to run before reaching oversold conditions.

Therefore, the bears will look to ride the current run of declines toward 1.1496 or lower to 1.1393. On the other hand, the bulls will look to pounce on rebounds at about 1.1691 or higher at 1.1784.