EURUSD Bulls may remain interested as long as the 1.0720 level is maintained.
After the significant downward reversal seen ahead of the weekend. The EURUSD has entered a recovery period hovering about 1.0750 early Monday. The pair’s short-term technical picture is devoid of direction. A paucity of high-impact macroeconomic data releases will keep investors focused on risk. Perception and central bank officials’ comments.
In the absence of high-quality data releases, markets will pay special heed to risk perception.
According to German statistics, the IFO Business Climate Index increased to 93.3 in March from 91.1 in February. Above the market forecast of 90.9. An IFO economist commented on the survey’s findings. Saying that a winter recession in Germany had become less likely. And that more than 40% of questioned businesses reported supply constraints in March.
Policymakers at the European Central Bank (ECB) Pablo Hernandez de Both Cos and Gediminas Imkus stated on Monday. That European banks are well-prepared for unfavorable situations due to their robust liquidity and capitalization. After these remarks, the Euro Stoxx 50 is trading in positive territory but remains below its opening highs.
Nevertheless, after the positive activity in Asian trading hours, US stock index futures trade neutral. The Texas Manufacturing Survey from the Federal Reserve Bank of Dallas will be the only data on the US economic docket.
If Wall Street’s key indexes begin in positive territory and continue to rise, risk flows will weigh on the US Dollar while helping EURUSD maintain its footing, and vice versa.
EURUSD Technical Outlook
The four-hour chart’s Relative Strength Index (RSI) signal remains at 50, and EURUSD trades between the 20- and 50-period Simple Moving Averages (SMAs), reflecting the indecisive behavior.
On the downside, 1.0720 (Fibonacci 50% retracement of the most recent upswing, 50-period SMA) serves as significant support ahead of the 1.0660/1.0670 level, where the 100-period SMA, 200-period SMA, and Fibonacci 61.8% retracement all intersect.
If the pair climbs over 1.0760 (Fibonacci 38.2% retracement) and begins to use it as support, it may aim for 1.0800 (psychological level) and 1.0820 (20-period SMA, Fibonacci 23.6% retracement).
