EURUSD Breakout Above the 200 Weekly SMA
The EUR/USD pair has shown strong buying momentum this month, climbing above the 1.10 level and breaking out of its year-long trading range. However, buyers still face a final resistance level at 1.1275. Since April of last year, this currency pair has encountered resistance at the 100-week SMA (red), but two weeks ago, buyers pushed EUR/USD above this moving average amid pronounced USD weakness, signaling a strong bullish trend.
EUR/USD Chart Weekly – The 200 SMA Has Been Broken
Last week, the pair climbed to 1.1201, breaking through the 200-week SMA, which had served as resistance in July 2023, and surpassing the December 2023 high of 1.1140, despite signs of a weakening Eurozone economy, as indicated by last week’s PMI surveys. Now, the pair is facing last year’s high of 1.1275, and it remains to be seen if buyers can reach and sustain this level.
The recent strength of the EUR/USD pair has been driven by increased risk appetite following its breakout above the 2024 high of 1.1043, supported by weaker US economic data and growing expectations of a rate cut by the Federal Reserve in September, particularly after Powell’s testimony at the Jackson Hole Symposium on Friday. The latest FOMC meeting minutes were also dovish, showing that officials had begun discussing potential rate reductions in July. Nevertheless, the Eurozone economy continues to face challenges.
German Ifo Business Climate for August 2024
- German August Ifo Business Climate Index: Came in at 86.6 points, slightly above the expected 86.0 points. This indicates a modest improvement in business sentiment compared to expectations.
- July Ifo Business Climate Index: Was recorded at 87.0 points, showing a decrease from the previous month, reflecting some softening in the overall business climate.
- German Ifo Current Conditions Index: Matched expectations, coming in at 86.5 points. This suggests that the assessment of the current economic situation by businesses remained stable.
- German Ifo Expectations Index: Also aligned with expectations at 86.5 points, indicating that businesses’ outlook for the coming months remains cautious and unchanged.
EUR/USD Live Chart
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