EURUSD Technical Analysis

<p>Last week we heard from many central bank speakers. The
overall consensus remains the same: wait for more data to determine the extent
of further tightening. Although the majority of the FOMC anticipates two
additional rate hikes this year, they consistently emphasize that these
decisions are contingent upon the data. Last week's data inclines them more
toward a hike, given the surprisingly hot <a href="https://www.forexlive.com/news/us-may-housing-starts-1631m-vs-1400m-expected-20230620/">housing market data</a>, the stable
<a href="https://www.forexlive.com/news/initial-jobless-claims-264k-versus-260k-estimate-20230622/">US Jobless Claims</a>, and the <a href="https://www.forexlive.com/news/us-june-flash-sp-global-services-pmi-541-vs-540-expected-20230623/">US Services PMI</a> beating
expectations. </p><p>Naturally, the forthcoming NFP and CPI reports will
play a pivotal role. However, if we continue to get good data, the market's
current expectation of a rate increase by the Fed in July seems likely. On the
other hand, the ECB speakers made clear that a July hike is almost guaranteed
unless there’s a material change in the data, but the September hike is much
more data-dependent and given the recent surprisingly <a href="https://www.forexlive.com/news/forexlive-european-fx-news-wrap-euro-slides-as-pmi-data-disappoints-heavily-20230623/">weak European PMI data</a>, the ECB
may stop already in July. </p><p>EURUSD Technical Analysis –
Daily Timeframe</p><p>On the daily chart, we can see that EURUSD erased
all the May weakness and rallied back into the 1.10 handle in June. The price
got rejected pretty strongly there and the weak European PMIs extended the fall
towards the 1.0844 level. The trend for now remains bullish as the <a href="https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/">moving averages</a> are
still crossed to the upside and the price is making higher highs and higher
lows, but the momentum is weakening and if the data for the Eurozone keeps
disappointing, we may see a top here. </p><p>EURUSD Technical Analysis –
4 hour Timeframe</p><p>On the 4 hour chart, we can see that the last push
into the 1.10 handle was <a href="https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/">diverging</a> with the
<a href="https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/">MACD</a>, which
was a sign of a weakening momentum and it’s often followed by pullbacks or
reversals. The price since then broke the previous swing low and the <a href="https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/">trendline</a>, which
may be an early sign of a change in trend, and pulled back into the red 21
moving average and 50% <a href="https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/">Fibonacci retracement</a> level.
This is where we should expect the sellers piling in to target another fall
into the 1.0779 support. </p><p>EURUSD Technical Analysis –
1 hour Timeframe</p><p>On the 1 hour chart, we can see that at
the moment the price is trading within a rising channel with the buyers leaning
on the red 21 moving average for further upside. We can expect more buying
pressure to come if the price breaks above the 61.8% level and the trendline as
such a move would invalidate the bearish setup. On the other hand, more
conservative sellers can wait for the price to break below the lower bound of
the channel to pile in and extend the selloff into the 1.0779 support. </p><p><a href="https://www.forexlive.com/EconomicCalendar">This week</a> is a
bit empty on the data front with just the EZ CPI and US Jobless Claims on
Thursday and the US PCE scheduled for Friday. Nonetheless, we will hear again
from many central bank members. </p>

This article was written by FL Contributors at www.forexlive.com.