EUR/USD Edges Higher But Remains Capped By 1.0670
The EUR/USD edged higher on Thursday as the dollar faced mild selling pressure following the release of jobless claims data. However, the EUR/USD upside potential is limited due to a scarce economic calendar and Covid-related concerns in China.
At the time of writing, the EUR/USD pair is trading at 1.0649, up 0.35% on the day, after being rejected once again by the 1.0670 area.
Market sentiment deteriorated on Thursday amid reports of surging coronavirus infections in China, which is casting doubts about the economic recovery in the second-largest world economy. Furthermore, several Western countries have started to impose mandatory tests for people arriving from China after Beijing’s rollback of ‘zero-Covid’ policies.
On the data front, U.S. initial jobless claims came in at 225,000 in the week ending December 23, in line with market expectations but above the previous reading of 216,000. Still, data had virtually no impact on prices while the volume remains thin ahead of the year-end.
From a technical perspective, the EUR/USD short-term outlook remains slightly bullish, according to the daily chart. The price trades above its main moving averages while technical indicators start to recoup some traction. The RSI has gained slope and stands above its midline, while the MACD printed decreasing red bars.
On the upside, the EUR/USD pair needs to overcome the 1.0675 resistance area, which has been capping advances over the last couple of weeks. A break above this level would expose the 1.0700 psychological level and the December monthly high of 1.0736. On the other hand, the immediate support level could be found at the 20-day SMA at around 1.0585, followed by 1.0540 and the 1.0500 mark.
At the time of writing, the EUR/USD pair is trading at 1.0649, up 0.35% on the day, after being rejected once again by the 1.0670 area.
Market sentiment deteriorated on Thursday amid reports of surging coronavirus infections in China, which is casting doubts about the economic recovery in the second-largest world economy. Furthermore, several Western countries have started to impose mandatory tests for people arriving from China after Beijing’s rollback of ‘zero-Covid’ policies.
On the data front, U.S. initial jobless claims came in at 225,000 in the week ending December 23, in line with market expectations but above the previous reading of 216,000. Still, data had virtually no impact on prices while the volume remains thin ahead of the year-end.
From a technical perspective, the EUR/USD short-term outlook remains slightly bullish, according to the daily chart. The price trades above its main moving averages while technical indicators start to recoup some traction. The RSI has gained slope and stands above its midline, while the MACD printed decreasing red bars.
On the upside, the EUR/USD pair needs to overcome the 1.0675 resistance area, which has been capping advances over the last couple of weeks. A break above this level would expose the 1.0700 psychological level and the December monthly high of 1.0736. On the other hand, the immediate support level could be found at the 20-day SMA at around 1.0585, followed by 1.0540 and the 1.0500 mark.