In the latest daily chart analysis for EUR/USD, the currency pair appears poised for a potential breakout while navigating pivotal economic data from both the Eurozone and the United States. After a series of higher lows in February, EUR/USD has climbed back above the psychologically important 1.0600 level, showing signs of bullish momentum as investors react to central bank commentary and inflation reports.
Technical Analysis Overview
EUR/USD Daily Chart, Sigmanomics
- Support and Resistance:
- Immediate Support: 1.0500
- Immediate Resistance: 1.0700 – 1.0800
- Momentum Indicators:
- Stochastic Oscillator: Currently showing an upward trajectory, hinting at continued bullish momentum if buying pressure remains consistent.
- Moving Averages: Short-term moving averages (e.g., 20-day) are curling upwards, further supporting a bullish bias. However, traders should keep an eye on the longer-term averages (50-day, 100-day) for confirmation of sustained upward momentum.
- Volume and Volatility:
Trading volumes have shown a moderate uptick, suggesting growing interest in EUR/USD. While volatility remains relatively contained, upcoming economic events could trigger sharp price movements.
Recent News Events Driving EUR/USD
- ECB’s Hawkish Tone:
The European Central Bank (ECB) has signaled more rate hikes if inflation remains above target levels. Markets are closely watching the ECB’s commitment to taming inflation, which supports the euro’s strength.
Source: ECB – European Central Bank - Fed’s Policy Outlook:
The Federal Reserve continues to emphasize its data-driven approach, weighing the need for further rate hikes to combat persistent inflation. Mixed economic data from the U.S. has led to speculation about the Fed’s next move, creating fluctuations in the dollar.
Source: Federal Reserve – Board of Governors - Eurozone Economic Data:
Recent releases indicate that while inflation is gradually moderating, core inflation remains sticky. Eurozone GDP forecasts show modest growth, providing some tailwinds for the euro.
Source: Reuters – Eurozone GDP Data - U.S. Labor Market:
A strong labor market and low unemployment rates in the U.S. have kept the dollar relatively robust. Any significant shift in jobless claims or non-farm payroll data could alter expectations for the dollar’s trajectory.
Source: Bloomberg – U.S. Jobs Report - Geopolitical Developments:
Ongoing geopolitical tensions and energy market shifts continue to impact both the euro and the dollar. Traders are monitoring how these external factors influence risk sentiment and capital flows.
Source: Financial Times – Geopolitics
Outlook
As the pair consolidates near 1.0600, a break above the 1.0700–1.0800 resistance could signal continued upside potential. Conversely, if the pair fails to maintain momentum, a pullback toward 1.0500 support remains possible. Market participants will closely watch central bank communications and upcoming inflation reports for direction.
Written by Sigmanomics team
