EUR/USD Price Aiming Back to 1.1000 amid Weak USD, Eying ECB

• EUR/USD bulls have taken over and brought back bullish momentum.
• Lagarde’s hawkish sentiments are pushing the pair higher.
• Today will be a volatile day for the EUR/USD as Lagarde is expected to speak.

Due to Germany’s favorable business climate data, Monday saw the EUR/USD price pushing up and closing on a large-bodied bullish candle. It is clear that bulls are slowly gathering momentum, and they might just be able to push the pair back up to 1.1000.

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ECB president Christine Lagarde, who is expected to speak later on the day, summarized her opinion over the weekend, noting that she expects net purchases in the Asset Purchase Plan to end early in the third quarter due to rising inflation. This move would pave the way for rate hikes starting in July to exit negative interest rates by the third quarter. Such hawkish statements from a usually dovish-leaning Largarde saw EUR/USD pushing up to 1.0700.

The tides have shifted in the EUR/USD market. It is now a battle between bulls and bears. Some investors expect the pair to get to parity at 1.0000, while others expect it to start a new trend before it gets to parity. It is also clear that the ECB will not stand by and watch the euro get much weaker. Rising interest rates could see the euro going higher in the coming weeks.

EUR/USD key events today

Today is a busy day for EUR/USD as there is a lot that investors will be looking out for, including the German manufacturing PMI, which is expected to come in lower than the previous 54.6 at 54.0.

For April, new home sales in the US are expected to go down from 763k to 750k.

Investors are also waiting to hear from Fed Chairman Powell, who is expected to speak later in the day. Finally, ECB president Christine Lagarde is also expected to speak. All these events will make the EUR/USD quite volatile.

EUR/USD price technical forecast: Bulls rallying above 1.0650

The 4-hour chart tells us the story of the returning bulls. Price was able to break the 1.0600 level and close above it, showing the return of bullish momentum. Since late March, it is also the first time that we have seen RSI above the 70 level.

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If bulls are strong enough to get prices in the overbought region, they might be strong enough to get prices back to 1.1000. Currently, the price is experiencing a bit of resistance at 1.0700. It might pull back to retest 1.0600 before seeking higher highs, or it might just break above 1.0700 if there is enough momentum during the day.

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