EUR/USD Breaks Consolidation Range as US Dollar Weakens

The EUR/USD pair has successfully broken out of the narrow consolidation range below 1.0730 during the Asian session. This upward movement is driven by the weakening US Dollar Index (DXY), which has fallen below 104.00.

The decline in the USD Index follows the release of disappointing United States ISM Services PMI data. While Services PMI remained above the 50.0 threshold, it landed lower at 50.3 compared to the expected 51.5. In contrast, the Euro is expected to show strength with the release of positive Eurozone Retail Sales data for April. Monthly data is projected to expand by 0.2% after a contraction of 1.2% last month, while annual data is expected to contract by 1.8% versus a contraction of 3.8%.

During a hearing before the Committee on Economic and Monetary Affairs (ECON) of the European Parliament, ECB President Christine Lagarde reiterated the presence of strong price pressure in the Euro area.

The EUR/USD pair has broken out of the consolidation range of 1.0707-1.0724 on an hourly scale, following a previous breakout above the downward-sloping trendline from the May 16 high at 1.0904. The 20-period Exponential Moving Average (EMA) at 1.0714 is providing support to the Euro bulls, while the Relative Strength Index (RSI) (14) has entered the bullish range of 60.00-80.00, suggesting further upside potential.

Looking ahead, a decisive break above the May 30 high at 1.0746 may propel the pair towards the June 02 high at 1.0779, followed by the psychological resistance level at 1.0800.

Alternatively, if the pair drops below the June 05 low at 1.0675, a downside move could resume, targeting the May 31 low at 1.0635 and the March 03 low at 1.0588.

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

Related Articles

Forex Signals April 25: Will Trade Talks & Earnings Offer a Bullish Finish for DJIA?

3 days ago

Save

EUR/USD Holds $1.1306—Market Eyes ECB Cuts and Trump’s Trade Standoff

3 days ago

Save

EUR/USD Gains—$1.1419 in Sight on ECB Shift, USD Weakness

4 days ago

Save

Comments

0 0 votes

Article Rating

Subscribe

Login

Notify of

new follow-up commentsnew replies to my comments

Please login to comment

0 Comments

Oldest

Newest Most Voted

Inline Feedbacks

View all comments