EUR/USD Forecast: Consolidative phase continues around 1.0600

EUR/USD Current Price: 1.0618

  • German and US Consumer Confidence improved, according to fresh updates.
  • The US will publish the final estimate of its Q3 GDP on Thursday.
  • EUR/USD trades with a near-term neutral stance as bulls retain control.

The EUR/USD pair held within familiar levels on Wednesday, losing ground through American trading hours and ending the day around the 1.0600 mark. The US Dollar benefited from an upbeat report, as CB Consumer Confidence increased in December by more than anticipated, with the index surging to 108.3 from an upwardly revised 101.4 in November. The index is now at its highest level since April 2022.

Earlier in the day, Germany published the Gfk Consumer Confidence Survey, which improved to -37.8 in January from -40.1 in January. Also, the United States published Mortgage Applications for the week ended December 16, up 0.9%, while Existing Home Sales declined by 7.7% in November.

Thursday will bring some reports of interest as the US will unveil the final estimate o its Q3 Gross Domestic Product, expected to confirm an annualized pace of growth of 2.9%. The country will also publish Initial Jobless Claims for the week ended December 16 and Q3 PCE inflation.

EUR/USD short-term technical outlook

The daily chart for the EUR/USD pair shows demand has eased, but technical readings are far from suggesting an upcoming decline. The pair holds above all of its moving averages, with the 20 SMA advancing well above the longer ones. The Momentum indicator turned south but is barely holding above its 100 SMA. The Relative Strength Index (RSI), on the other hand, keeps consolidating near overbought readings.

The 4-hour chart offers a neutral stance. EUR/USD seesaws for a third consecutive day around a mildly bearish 20 SMA, while the longer moving averages keep heading north below it. Technical indicators, in the meantime, turned marginally lower within neutral levels. The pair could shed some more ground in the near term, particularly if it breaks below the 1.0580 level, but a steeper decline is out of the picture for now.

 Support levels: 1.0580 1.0535 1.0480

Resistance levels: 1.0650 1.0695 1.0740

View Live Chart for the EUR/USD

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