"EUR/USD: Challenges Below 1.0950"
The EUR/USD pair experiences modest losses in the early Asian trading session on Monday. Increased demand for the U.S. Dollar has pushed the major currency pair lower. The potential upside for the EUR seems limited due to macroeconomic prospects. The pair is trading near the 1.0935 level, down 0.08% on the day. EUR/USD continues to trade in the upper half of the ascending regression channel, with the Relative Strength Index (RSI) holding just above 50, indicating a lack of selling interest.
The 1.0950 level (61.8% Fibonacci retracement of the downtrend from July to October) is considered a strong resistance before 1.1000 (psychological level, static level), and 1.1025 (static level from August).
On the flip side, support levels are located at 1.0900 (50-period Simple Moving Average (SMA), psychological level), 1.0850 (50% Fibonacci retracement level), and 1.0800 (100-period SMA, lower limit of the ascending channel). EUR/USD closed the second consecutive session in negative territory on Thursday but attempted to stabilize above the 1.0900 level on Friday. S&P Global will release Manufacturing and Services PMI data for the U.S. at the end of the day, but thin trading conditions on Black Friday may limit the pair's actions before the weekend.
Data from Germany shows that the IFO Business Climate Index, Germany's leading indicator, improved to 87.3 in November from 86.9 in October. The Current Assessment Index increased to 89.4 from 89.2, while the Expectations Index rose to 85.2 from 84.8. Although these figures are slightly lower than analyst estimates, they have little impact on the Euro's valuation.
Meanwhile, in an interview with Boersen-Zeitung on Thursday, European Central Bank policy maker Pierre Wunsch called the market pricing for interest rate cuts "very optimistic" and argued that this stance could increase the likelihood of further tightening.
Business activity for private sectors in the U.S. is forecasted to slow down in November. In the event of disappointing PMI results, the U.S. Dollar (USD) may struggle to sustain its recovery against its counterparts in the U.S. trading session.
The 1.0950 level (61.8% Fibonacci retracement of the downtrend from July to October) is considered a strong resistance before 1.1000 (psychological level, static level), and 1.1025 (static level from August).
On the flip side, support levels are located at 1.0900 (50-period Simple Moving Average (SMA), psychological level), 1.0850 (50% Fibonacci retracement level), and 1.0800 (100-period SMA, lower limit of the ascending channel). EUR/USD closed the second consecutive session in negative territory on Thursday but attempted to stabilize above the 1.0900 level on Friday. S&P Global will release Manufacturing and Services PMI data for the U.S. at the end of the day, but thin trading conditions on Black Friday may limit the pair's actions before the weekend.
Data from Germany shows that the IFO Business Climate Index, Germany's leading indicator, improved to 87.3 in November from 86.9 in October. The Current Assessment Index increased to 89.4 from 89.2, while the Expectations Index rose to 85.2 from 84.8. Although these figures are slightly lower than analyst estimates, they have little impact on the Euro's valuation.
Meanwhile, in an interview with Boersen-Zeitung on Thursday, European Central Bank policy maker Pierre Wunsch called the market pricing for interest rate cuts "very optimistic" and argued that this stance could increase the likelihood of further tightening.
Business activity for private sectors in the U.S. is forecasted to slow down in November. In the event of disappointing PMI results, the U.S. Dollar (USD) may struggle to sustain its recovery against its counterparts in the U.S. trading session.
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