EUR/USD Meets Buyers Around A Critical Fibonacci Resistance At 1.1917

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EUR/USD Current Price: 1.1916

• ECB’s President Christine Lagarde said tightening would be premature.
• The dollar corrected lower in a risk-on scenario but remains the strongest.
• EUR/USD meets buyers around a critical Fibonacci resistance at 1.1917.

The EUR/USD pair recovered some ground at the beginning of the week, reaching an intraday high of 1.1920. The advance was mostly corrective, as the greenback was extremely overbought post-Fed announcement on Wednesday. The macroeconomic calendar had little to offer, but policymakers were on the wires. The European Central Bank President Christine Lagarde said that the outlook for the euro area economy is brightening as the pandemic situation improves but warned about the need to remain vigilant, adding that tightening would be premature.

In the US, St. Louis Fed President James Bullard noted that they would not need the emergency policies anymore as the pandemic comes to a close, but added that low  interest rates and low inflation rate era are not ending anytime soon. Also, Dallas Fed President Robert Kaplan is in favor of “taking the foot off the accelerator sooner rather than later.” The country published the Chicago Fed National Activity Index, which improved to 0.29 in May from -0.09 previously.

On Tuesday, the EU will publish the preliminary estimate of June Consumer Confidence, foreseen at -3 from -5.1 previously. US Federal Reserve chief Powell will testify on the Fed’s emergency lending programs and current policies before the House Select Subcommittee on the Coronavirus Crisis.

EUR/USD short-term technical outlook

The EUR/USD pair holds near its daily high, stuck around the 61.8% retracement of its March/May rally at 1.1917. The 4-hour chart shows that a firmly bearish 20 SMA heads firmly lower just a few pips above the mentioned Fibonacci resistance. Technical indicators corrected extreme oversold readings, losing upward strength within negative levels, reflecting the absence of buying interest. The corrective advance could continue if the pair advances beyond the daily high, but bears will retain control as long as it trades below 1.2000.  

 Support levels: 1.1885 1.1840 1.1800  

Resistance levels: 1.1920 1.1960 1.2000

Image by martaposemuckel from Pixabay

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.