EUR/USD Is Neutral-To-Bullish In The Near-Term, Comfortable Above 1.2200

EUR/USD Current Price: 1.2213

• US Federal Reserve officials’ comments remain centered on rising inflation.
• Lower US government bond yields weighed on the American currency.
• EUR/USD is neutral-to-bullish in the near-term, comfortable above 1.2200.

The financial world started the week cautiously, with the greenback ending the day lower against most major rivals. The EUR/USD pair hit an intraday high of 1.2229 at the beginning of the American session, from where it pulled down to the current 1.2210 price zone. A holiday in Europe and Canada kept major pairs inside limited intraday ranges, while the greenback fell alongside US government bond yields.

The macroeconomic calendar had nothing to offer. The EU did not publish macroeconomic figures, while the US released the April Chicago Fed National Activity Index, which printed at 0.24, down from the previous 1.71. Federal Reserve officials were in the wires, and comments  Governor Lael Brainard outstand. Among other things, he noted that the US economy is in the middle of an unprecedented economic rebound and that some bottlenecks on the supply chain contribute to inflation. He added that the Fed has the tools to deal with inflation if it moves persistently above target. On a separate event, St. Louis Fed President James Bullard noted he expects to see more inflation but added that it would mostly be temporary.

This Tuesday, Germany will publish a revision of its Q1 Gross Domestic Product, expected to be confirmed at -1.7% QoQ. The country will also release the May IFO Survey, with the Business Climate seen at 98.1 from 96.8 previously. The US will publish housing-related data and the May Richmond Fed Manufacturing Index.

EUR/USD Short-Term Technical Outlook

The EUR/USD pair is neutral-to-bullish in the near-term, still needing to break above the 1.2245 level. The 4-hour chart shows that the pair settled above all of its moving averages, although the 20 SMA remains flat, reflecting the lack of interest. Technical indicators hold within positive levels, but the Momentum eases, and the RSI stands flat at around 57, also indicating absent speculative interest. The bearish case may become stronger on a break below 1.2160, where the pair bottomed last Friday.

Support levels: 1.2160 1.2110 1.2070

Resistance levels: 1.2245 1.2290 1.2330

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