The Euro is trading slightly lower at the mid-session after clawing back nearly all of its earlier losses. Additionally, the single-currency remains within striking distance of a two-year high at 1.1816.
The Euro was pressured from the opening on profit-taking after the U.S. Federal Reserve’s comments on Wednesday strengthened the U.S. Dollar. The currency found intraday support after a report showed Euro Zone sentiment rebounded, but gains were capped as unemployment rose.
At 13:18 GMT, the EUR/USD is trading 1.1783, down 0.0009 or -0.07%.
Euro Zone economic sentiment rebounded more than expected in July as governments relaxed restrictions related to the COVID-19 pandemic, with the sharpest gains in industry and services even though consumers became more gloomy, data showed on Thursday.
The European Commission said economic sentiment rose to 82.3 points in July from an upwardly revised 75.8 in June, beating market expectations of an increase to 81.0.
Inflation expectations among consumers for the next 12 months fell to 17.5 in July from 21.6 in June.
Euro Zone unemployment rose to 7.8% of the workforce in June, up from an upwardly revised 7.7% in May.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through 1.1806 will signal a resumption of the uptrend. This could trigger a quick rally into the September 24, 2018 main top at 1.1816. This level is a potential trigger point for an acceleration to the upside.
Daily Swing Chart Technical Forecast
The direction of the EUR/USD on Thursday basically comes down to momentum.
If the upside momentum we’ve see the last two weeks returns then the two tops at 1.1806 and 1.1816 should easily be overcome.
The first sign of weakness today will be the Euro’s inability to overcome 1.1806. The second sign of weakness will be a lower trade. Finally, taking out yesterday’s low at 1.1741 will turn 1.1806 into a new minor top. This would indicate the selling pressure is getting stronger.
Taking out 1.1806 then closing lower for the session will form a potentially bearish closing price reversal top. If confirmed, this could trigger the start of a 2 to 3 day correction.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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