- The US FDA fully approved the Pfizer & BioNTech vaccine, accelerating US inoculations.
- The EUR/USD trades with a bullish bias at the 1.1772 level ahead of the US Prelim GDP q/q from the Bureau of Economic Analysis.
- Forex trading market participants may look to buy above the $ 1.1750 level today.
The EUR/USD closed at $1.1770 after hitting a high of $1.1775 and a low of $1.1725. The pair continued its bullish streak for the 4th consecutive session amid the declining prices of the US dollar. The EUR/USD is trading with a bullish bias at the 1.1772 level ahead of the US Prelim GDP q/q from the Bureau of Economic Analysis.
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Weakness in the US Dollar Underpins EUR/USD
The US Dollar Index, which measures the greenback’s value against the basket of six major currencies, dropped for the third consecutive session. It reached a 92.82 level that pushed the EUR/USD pair higher on the day.
Whereas the single currency, the Euro was under pressure for the day due to a poor-than-expected macroeconomic data release. However, the currency pair managed to remain green for the day as investors were more focused on the weakness of the US dollar than the weakness of the Euro.
Quick Economic Events Review
On the data front, at 13:00 GMT, the German Ifo Business Climate from Ifo Institute declined to 99.4 against the predicted 100.2 and weighed on the single currency Euro. At 17:56 GMT, the Belgian NBB Business Climate from August dropped to 7.6 against the forecasted 9.1 and limited the rising prices of the EUR/USD.
From the US side, at 17:30 GMT, the Core Durable Goods Orders from July rose to 0.7% against the anticipated 0.5% and supported the US dollar, which further caped gains in the EUR/USD pair. In July, the Durable Goods Orders also improved to-0.1% against the projected-0.3% and supported the US dollar, which kept the gains of the EUR/USD pair limited for the day.
The US FDA fully approved the Pfizer & BioNTech vaccine.
The greenback came under pressure after concerns about global economic recovery eased a little. The US FDA fully approved the Pfizer & BioNTech vaccine, accelerating US inoculations. Furthermore, it is expected that the Moderna vaccine will also receive full approval from the FDA within the coming weeks. Thus, it will add up to the process of increasing vaccinated people in less time.
The market mood was eased further with the optimistic comments from the US top health expert, Dr. Anthony Fauci, who said that coronavirus could be under control by early next year. All these positive developments surrounding the vaccine and coronavirus ecosystem added to the risk-on market sentiment. This eventually helped the riskier currency pair EUR/USD to remain green for the day.
Bureau of Economic Analysis to Report Prelim GDP q/q
The Bureau of Economic Analysis is releasing the Prelim GDP q/q with a forecast of 6.7% versus 6.5% beforehand. Therefore, the EUR/USD may face a slight downward pressure upon the release of a stronger than the forecasted figure from the US.
EUR/USD Price Forecast – Daily Technical Levels
Support Resistance
1.1739 1.1789
1.1707 1.1807
1.1689 1.1839
Pivot Point: 1.1757
EUR/USD Technical Analysis: Eyes on the US Prelim GDP
The EUR/USD is trading with a bullish bias at the 1.1772 level ahead of the US Prelim GDP q/q from the Bureau of Economic Analysis. On the upper side, the next resistance stays at the 1.1805 mark. Similarly, a continuation of the bullish could lead the pair towards the 1.1854 and 1.1895 marks.
On the 4-hour chart, the downward trendline that provided resistance at the 1.1750 level has already been violated. Therefore, the chances of a bullish trend continuation remain pretty solid.
On the 3 hour timeframe, the 50 day EMA (Exponential Moving Average – Red Line) supports the EUR/USD at the 1.1740 level. Above this, the bullish bias remains strong today. Besides this, the oscillator indicator Stochastic RSI is still in the bullish zone and offering an excellent opportunity to go long.
Therefore, Forex trading market participants may look to buy above the $ 1.1750 level today. The initial targets are likely to be at $ 1.1805 and $ 1.1854 levels. Alternatively, sell trades can be taken below the $ 1.1750 level to target $ 1.1706 and 1.1660. All the best!
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