There is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500.

Bearish View

• Sell the EUR/USD and set a take-profit at 1.0450.
• Add a stop-loss at 1.0625.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.0600 and add a take-profit at 1.0650.
• Add a stop-loss at 1.0500.

The EUR/USD is stuck close to the lowest level this year as investors focused on the interest rate decision by the Federal Reserve and the average US jobs data. The pair is trading at 1.0545, which is slightly above last week’s low of 1.0467.

Fed and NFP Data

The EUR/USD pair was in a tight range last week as investors reflected on the mixed events that happened last week. In the first place, data by Markit and the Institute of Supply Management (ISM) showed that the US and EU manufacturing and services sectors were cooling down as inflation continues.

The biggest event last week was the interest rate decision on Wednesday. In its decision, the bank decided to deliver its biggest interest rate hike in more than 20 years. It also hinted that it will continue hiking interest rates in the remaining meetings in a bid to counter the soaring inflation. Precisely, it noted that the neutral rate will be at 3%.

The EUR/USD pair also reacted to the latest American jobs data. The economy added 428k jobs in April while the unemployment rate moved to 3.6%. At the same time, wages held steady above 5% as the labor shortage continued rising.

In response to these jobs numbers, the bond and stock markets continued their sell-off. The 10-year bond yield, which moves inversely to prices, rose to a high of 3.14% while the 30-year rose to 3.2%. The Dow Jones and the Nasdaq 100 fell by more than 0.30%.

The pair will next react to important data from the United States. On Wednesday, the US will publish the latest consumer price index (CPI). Economists expect the data to show that inflation by 8.1% while core CPI rose by 6.1%. These numbers will provide signs that the American inflation has started peaking.

EUR/USD Forecast

The EUR/USD pair continued struggling last week as the market reflected on the latest jobs data and the FOMC decision. On the four-hour chart, the pair has formed a bearish flag pattern and moved below the 25-day and 50-day moving averages. The pair has also moved between the lower and middle lines of the Bollinger Bands.

Therefore, there is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. A move above the key resistance at 1.0600 will invalidate the bearish view.

There is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. 

Bearish View

• Sell the EUR/USD and set a take-profit at 1.0450.
• Add a stop-loss at 1.0625.
• Timeline: 1-2 days.

Bullish View

• Set a buy-stop at 1.0600 and add a take-profit at 1.0650.
• Add a stop-loss at 1.0500.

The EUR/USD is stuck close to the lowest level this year as investors focused on the interest rate decision by the Federal Reserve and the average US jobs data. The pair is trading at 1.0545, which is slightly above last week’s low of 1.0467.

Fed and NFP Data

The EUR/USD pair was in a tight range last week as investors reflected on the mixed events that happened last week. In the first place, data by Markit and the Institute of Supply Management (ISM) showed that the US and EU manufacturing and services sectors were cooling down as inflation continues.

The biggest event last week was the interest rate decision on Wednesday. In its decision, the bank decided to deliver its biggest interest rate hike in more than 20 years. It also hinted that it will continue hiking interest rates in the remaining meetings in a bid to counter the soaring inflation. Precisely, it noted that the neutral rate will be at 3%.

The EUR/USD pair also reacted to the latest American jobs data. The economy added 428k jobs in April while the unemployment rate moved to 3.6%. At the same time, wages held steady above 5% as the labor shortage continued rising.

In response to these jobs numbers, the bond and stock markets continued their sell-off. The 10-year bond yield, which moves inversely to prices, rose to a high of 3.14% while the 30-year rose to 3.2%. The Dow Jones and the Nasdaq 100 fell by more than 0.30%.

The pair will next react to important data from the United States. On Wednesday, the US will publish the latest consumer price index (CPI). Economists expect the data to show that inflation by 8.1% while core CPI rose by 6.1%. These numbers will provide signs that the American inflation has started peaking.

EUR/USD Forecast

The EUR/USD pair continued struggling last week as the market reflected on the latest jobs data and the FOMC decision. On the four-hour chart, the pair has formed a bearish flag pattern and moved below the 25-day and 50-day moving averages. The pair has also moved between the lower and middle lines of the Bollinger Bands.

Therefore, there is a likelihood that the pair will have a bearish breakout as bears target the key support at 1.0500. A move above the key resistance at 1.0600 will invalidate the bearish view.

The pair will likely drop to 1.0473 and then resume the bullish trend.

Bullish View

• Set a buy-limit at 1.0473 and a take-profit at 1.0600.
• Add a stop-loss at 1.0400.
• Timeline: 1-2 days.

Bearish View

• Set a sell-stop at 1.0450 and a take-profit at 1.0350.
• Add a stop-loss at 1.0600.

The EUR/USD pair was little changed after the mixed economic data from the euro area and the upcoming interest rate decision by the Federal Reserve. It is trading at 1.0520, which is slightly below last Friday’s high of 1.0588.

Fed Decision Ahead

The EUR/USD pair declined slightly as investors react to the relatively weak consumer and business confidence data.

According to the European Commission, the bloc’s consumer confidence declined from -21.6 in March to -22.0 in April. This decline was worse than the median estimate of -16.9.

Additional data showed that service sentiment declined from 13.6 to 13.5 while industrial sentiment dropped to 9.0 to 7.9. These are important numbers because consumer and industrial confidence have an impact on spending.

Additional data showed that the manufacturing sector did relatively well in April. According to Markit, the German manufacturing PMI was at 55.5 in April, which was better than estimates. In Germany, the PMI dropped slightly to 54.6. Still, many manufacturers complained about the rising cost of doing business.

The EUR/USD pair declined as concerns about energy rose. EU members will conclude a meeting today where they are expected to place an embargo of Russian oil. The process will be phased and complete the process by end of the year. The decision accelerated after Berlin said that it had reduced its oil dependence to 12% and gas to 35%. The pair will react to the upcoming EU GDP and PPI data.

The next key mover for the pair will be the upcoming interest rate decision by the Federal Reserve. Economists expect that the Fed will start hiking interest rates by about 0.50%. The bank will also likely start its quantitative tightening (QT) policy. The rate hike will come at a time when data shows that the economy is weakening.

EUR/USD Forecast

The EUR/USD pair was little changed ahead of the upcoming interest rate decision. It is trading at 1.0515, which was slightly below last Friday’s high of 1.0600. On the four-hour chart, the pair moved slightly below the 25-day and 50-day moving averages while the Stochastic Oscillator has moved to the neutral level.

The pair has moved between the standard pivot point and and the first support. It also seems to be forming what looks like a double-bottom pattern whose upper chin is at 1.0600. The pair will likely drop to 1.0473 and then resume the bullish trend.