EUR/USD has lost its traction and erased a portion of its daily gains after having climbed toward 1.1000. With the US Dollar struggling to gather recovery momentum amid retreating Treasury bond yields, however, the pair stays in positive territory at around 1.0950. Much better than expected Chinese GDP and retail sales boosted hopes for economic growth, prompting investors into riskier assets.

On the other hand, German investor sentiment unexpectedly fell to 4.1% in April from 13.0 in March and signal that economic situation would remain unchanged in coming months, but so far with very limited negative impact on Euro.

Fresh recovery, however, needs more work on the upside to signal a higher low and end of corrective phase.

The daily chart for the EUR/USD pair shows buyers are trying to re-assume control. The pair bounced from near a bullish 20 Simple Moving Average (SMA), which resumed its advance above the longer ones and currently provides dynamic support at around the 1.0900 level. At the same time, technical indicators have pared their declines within positive levels and turned higher, as EUR/USD holds in the green. Still, additional gains remain unclear until the pair breaks through 1.1010, the immediate resistance level.

In the near term, and according to the 4-hour chart, on the contrary, it seems that buyers lack enough conviction to push EUR/USD higher. The pair stalled its advance below a directionless 20 SMA, while a mildly bullish 100 SMA provides dynamic support at around 1.0905, reinforcing the relevance of the area. Meanwhile, technical indicators resumed their declines within negative levels after correcting oversold conditions, leaving the door open for another leg south.

EURUSD to resume its move lower below 1.1000

Apr 18 2023