The Euro (EUR) inched higher against the US Dollar (USD) on Friday, increasing the price of EURUSD to more than 1.2050 following some key economic events. The technical bias has however turned bullish because of a higher high in the recent upside rally.
EUR/USD Technical Analysis
As of this writing, the pair is being traded near 1.2063. A hurdle may be noted around 1.2100 (a short-term horizontal resistance area as well as psychological number) ahead of 1.2176 (a major horizontal resistance) and then 1.2200 (the psychological number).
On the downside, a support can be noted around 1.1732 (a key horizontal support) ahead of 1.1639 (the low of the last major downside move) and then 1.1600 (the confluence of horizontal support as well as psychological number) as demonstrated in the given above chart. The technical bias shall remain bullish as long as the 1.0839 support area is intact.
US Jobless Claims
The number of Americans filing for unemployment benefits jumped to a more than two-year high last week amid a surge in applications in hurricane-ravaged Texas, but the underlying trend remained consistent with a strong labor market. The surge in claims reported by the Labor Department on Thursday offered an early glimpse of Hurricane Harvey’s impact on the economy. The storm unleashed unprecedented flooding in Houston, disrupting oil, natural gas and petrochemical production and forcing a temporary closure of refineries. As Texas tries to recover from the late August storm, Florida is bracing for Hurricane Irma, which is expected to make landfall over the weekend. Economists say Harvey could put a dent in third-quarter gross domestic product and hold back job growth in September. But they expect any lost output to be recouped in the fourth quarter and payrolls growth to rebound in October.
Considering the overall technical and fundamental outlook, selling the pair around current levels may be a good strategy in short to medium term.
EUR/USD forecast can also be found on FXOpen website.