EUR/USD Daily Forecast – U.S. Dollar Is Under Pressure Against Euro

Euro Gains Ground Against U.S. Dollar

EUR/USD is currently trying to settle back above 1.1630 while the U.S. dollar is under pressure against a broad basket of currencies.

The U.S. Dollar Index is slowly moving towards the support level which has recently emerged at 93.50. A move below this level will open the way to the test of the support at the 50 EMA at 93.40 which will be bullish for EUR/USD.

Today, foreign exchange market traders will have a chance to take a look at flash PMI reports from EU. Analysts expect that Euro Area Manufacturing PMI declined from 58.6 in September to 57 in October. Euro Area Services PMI is projected to decline from 56.4 to 55.5.

In the U.S., Manufacturing PMI is projected to decrease from 60.7 in September to 60.3 in October while Services PMI is projected to grow from 54.9 to 55.1.

Traders will also keep an eye on the developments in U.S. government bond markets. The yield of 10-year Treasuries has recently made an attempt to settle above the 1.70% level but failed to develop sufficient upside momentum and pulled back. In case the yield of 10-year Treasuries settles above this level, it will continue to move towards yearly highs near 1.77% which could provide more support to the American currency.

Technical Analysis

EUR/USD managed to get above 1.1630 and is trying to develop additional upside momentum. In case this attempt is successful, EUR/USD will get to the test of the next resistance level which is located at 1.1660.

A move above the resistance at 1.1660 will open the way to the test of the resistance at the 50 EMA at 1.1680. If EUR/USD gets above the 50 EMA, it will move towards the resistance at 1.1690. A successful test of the resistance at 1.1690 will open the way to the test of the next resistance at 1.1720.

On the support side, a move below 1.1630 will open the way to the test of the support level at 1.1610. If EUR/USD declines below this level, it will move towards the next support at 1.1580.

For a look at all of today’s economic events, check out our economic calendar.