Despite cautious tones from US Federal Reserve officials, the EUR/USD pair continued its ascent, hovering around the 1.0830 mark. This upward movement is attributed to the Eurozone’s mixed PMI data, which displayed economic resilience, particularly in the services sector, enhancing the Euro’s appeal to investors.

Notably, the preliminary Eurozone and German Services PMI showed unexpected vigour, contrasting with the manufacturing sector’s underperformance.

Conversely, the US dollar’s strength, fueled by optimistic economic indicators and a steadfast Federal Reserve, poses a challenge to further gains for the EUR/USD pair.

US Dollar’s Ascendancy: A Challenge for EUR/USD

The US dollar’s rally persisted, reaching near 103.90, underpinned by solid US yields and labour market data, notably the drop in initial jobless claims to 201K, beating forecasts. The Federal Reserve’s reluctance to cut rates soon, citing inflation worries, further underlines the dollar’s robustness.

This convergence of favourable US economic data and a hawkish Federal Reserve outlook may dampen the EUR/USD pair’s momentum, as a stronger dollar attracts more investors.

Eurozone’s Positive PMI Data Bolsters the Euro

The Euro finds solace in positive services PMI figures from the Eurozone and Germany for February, despite manufacturing PMIs not meeting expectations,. The European Central Bank’s (ECB) latest communications underscore a cautious approach towards monetary policy adjustments, prioritizing stability over immediate rate reductions.

The ECB’s caution, alongside improving services sector performance, offers a nuanced backdrop for the EUR/USD’s current trajectory, balancing between Eurozone economic optimism and the overarching strength of the US dollar.

EUR/USD Technical Outlook

The EUR/USD pair exhibits a slight uptick, registering a 0.01% rise to trade at 1.08247. It navigates above the pivot point at 1.0803, indicating a mild bullish sentiment within the market. Resistance levels are set at 1.0861, 1.0891, and 1.0932, which the pair may test if the upward momentum continues.

Conversely, support is established at 1.0764, with additional levels at 1.0732 and 1.0696 providing potential fallbacks in case of declines. The RSI stands at 57, suggesting moderate bullish momentum, while the 50-day EMA at 1.0796 acts as a near-term support level.

Overall, the EUR/USD’s outlook remains bullish above the $1.0802 threshold, hinting at the potential for continued upward movement as long as it sustains above this level.