The EUR/USD currency pair displayed a subdued trend on Wednesday, hovering around the 1.1700 level, as financial markets adopted a cautious stance ahead of important economic data from the United States. The current price for EUR/USD stands at 1.1683, reflecting modest selling pressure while remaining confined within familiar trading ranges.
During the London trading session, the Eurozone released its preliminary estimate of the December Harmonized Index of Consumer Prices (HICP), which indicated a year-on-year increase of 2%, consistent with expectations. Month-on-month, inflation as measured by the HICP rose by 0.2%, recovering from a 0.2% decline in November. Despite this data, the Euro experienced minimal impact on its valuation.
In the United States, the ADP Employment Change report revealed that the private sector added 41,000 jobs in December, falling short of the anticipated 47,000 but representing a significant improvement from the previous month’s decline of 32,000. Investors are now looking ahead to further economic indicators, including the upcoming October Factory Orders, the December ISM Services Purchasing Managers’ Index, and the November JOLTS Job Openings report.
Technical Analysis of EUR/USD
From a technical perspective, the outlook for EUR/USD appears skewed towards the downside. The four-hour chart shows that the pair is trading below a bearish 20-period Simple Moving Average (SMA), which is positioned below the 100-period SMA. This creates resistance levels at 1.1705 and 1.1743, while the pair struggles to maintain its position above a bullish 200-period SMA located at 1.1677.
On the daily chart, EUR/USD trades beneath the 20-day SMA at 1.1743 but remains above the 100-day SMA at 1.1667. This positioning indicates that the moving averages are containing price action. The momentum indicator has turned negative, and the Relative Strength Index (RSI) is flat at 44, reflecting the overall negative sentiment surrounding the pair.
Additionally, the 200-day SMA maintains a strong bullish slope well below the current price, suggesting a mid-term bullish alignment, even as short-term indicators indicate fading momentum. As the market anticipates the release of critical US economic data, traders remain vigilant for potential shifts in sentiment.
In summary, the EUR/USD pair continues to navigate a tight range as investors await significant economic reports from the United States that could influence market dynamics. With current levels indicating cautious sentiment, the upcoming data releases are expected to provide clarity on the pair’s trajectory in the near term.
