Ups and Downs: EUR/USD Reacts to U.S. Economic Vibes

EUR/USD pared some of its gains after upbeat US economic data. recovered sharply on upbeat market sentiment. It hit a high of 1.05780 at the time of writing and is currently trading around 1.05376.

The U.S. economy grew at an annualized rate of 2.8% in the third quarter of 2024, according to the Bureau of Economic Analysis, which is slightly lower than the previous quarter's growth of 3.0. Core durable goods orders, excluding transportation items, increased by 0.6% in October, showing ongoing strength in business investment and consumer demand. Additionally, the latest jobless claims data reported a decrease in initial claims for unemployment benefits to 210,000, suggesting a tightening labor market. This means employers are keeping their workers during uncertain economic times. Overall, these indicators reflect a stable economic environment with positive signs for growth.

Technical Analysis Overview

The pair remained above both short-term (34 and 55-4H EMA) and long-term (200-4H MA) moving averages.

Resistance and Support Levels

Resistance Levels: Near-term resistance is at 1.060. A breakout above this could push the pair towards targets at 1.0660/1.070/1.0760/$1.0835, and possibly 1.0900. Major bullish momentum is expected only if prices surpass 1.1000, which would open the door to 1.1070 and 1.1150.

Support Levels: Immediate support is at 1.0490. A drop below this could lead to further declines to 1.0435/1.0400/1.0370/1.0330/1.0240.

Indicator Insights

Indicator Insights (4-Hour Chart): The Commodity Channel Index (CCI) indicates a bullish trend, while the Average Directional Movement Index (ADX) suggests a neutral outlook.

Suggested Trading Strategy

Given the weak sentiment in technical indicators, a sensible strategy would be to sell on rallies around the 1.0570 mark, with a stop-loss at 1.0600 and a target price of 1.04560 for potential gains.