EUR/USD May See Exhaustion
The EURUSD currency pair has been quite bullish on the daily chart over the last few weeks, as the price holds above the 200 day exponential moving average. The pair has tested the 200 day EMA several times now since late February and has continued its bullish trend. Whilst in a current bullish trend we may be seeing some exhaustion here, as the EURUSD may be slightly overbought. The daily fast stochastic has been diverging for a few weeks now, the %K line has recently fallen below the 80 level, and the %D line may follow. This may be signaling that a short term sell off profit taking cycle may occur over the next few days and into next week.
Today's US Initial Jobless Claims data was quite bullish for the EURUSD pair from an expected perspective. The data showed an actual 228K, which was forecasted at 200K, and had a previous value of 246K. The data showed that US initial jobless claims unexpectedly increased, this was taken as bullish by the market in regards to the EURUSD, and bearish for the US dollar. Compared to last week's data, initial jobless claims decreased, this may be signaling that the DXY (US dollar strength index) has been fundamentally bullish lately. As recession and inflation fears continue today's US jobs data was a mixed picture.
Technically the EURUSD pair can potentially see some weakness over the next few days, and over the course of next week. This weekend is a long weekend in many countries that celebrate Good Friday and Easter, this may bring low trading volume to the market over the long weekend, including next Monday. Next Wednesday the US will be releasing Core CPI data for the month of March with an expected value of 0.4%, last month's data showed a value of 0.5% suggesting that inflation may be continuing to decrease.
Today's US Initial Jobless Claims data was quite bullish for the EURUSD pair from an expected perspective. The data showed an actual 228K, which was forecasted at 200K, and had a previous value of 246K. The data showed that US initial jobless claims unexpectedly increased, this was taken as bullish by the market in regards to the EURUSD, and bearish for the US dollar. Compared to last week's data, initial jobless claims decreased, this may be signaling that the DXY (US dollar strength index) has been fundamentally bullish lately. As recession and inflation fears continue today's US jobs data was a mixed picture.
Technically the EURUSD pair can potentially see some weakness over the next few days, and over the course of next week. This weekend is a long weekend in many countries that celebrate Good Friday and Easter, this may bring low trading volume to the market over the long weekend, including next Monday. Next Wednesday the US will be releasing Core CPI data for the month of March with an expected value of 0.4%, last month's data showed a value of 0.5% suggesting that inflation may be continuing to decrease.
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