Eurusd rises 0.1% to 1.08450 amid consolidation and positive economic indicators

EURUSD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	0.1%	11 Pips
Week to-date	0.13%	14 Pips
March	4.52%	469.3 Pips

Upcoming key events (London Time)

Wed 08:45 AM EUR European Central Bank’s President Christine Lagarde speech
Wed 12:30 PM USD CPI Inflation Rate (12-mth)
Thu 12:30 PM USD PPI excluding Food and Energy sectors (12-mth)

What happened lately

In the United States, the Job Openings and Labor Turnover Survey (JOLTS) indicated a positive trend for January, with job openings increasing to 7.74 million. This reflects a rise from the revised December figure of 7.508 million, suggesting a growing demand for labor and potential tightening in the labor market. Such data points may fuel optimism about economic recovery and could influence Federal Reserve policy in terms of interest rate considerations.

The Euro Area experienced an improvement in business sentiment, as evidenced by the sentix Economic Index rising to -2.9 points in March, an increase from -12.7 points in February. This uplift reflects a better outlook among investors for the Eurozone economy and could potentially lead to increased investment and economic activities, benefiting growth prospects in the coming months.

In Germany, January’s trade balance saw a decline to €16 billion from December’s €20.7 billion, indicating a decrease in the country’s trade surplus. Meanwhile, Germany’s industrial production figures showed mixed signals, with a 12-month rate improving to -1.6% from a previous -3.1%. The 1-month industrial production seasonal adjustment rebounded strongly to 2%, compared to December’s revised figure of -1.5%. These figures hint at some recovery in the industrial sector, albeit with some prevailing challenges in maintaining robust trade balance levels.

Regarding EURUSD, the currency pair observed a slight increase of 0.1% to 1.08450 on Tuesday, indicative of a phase of consolidation. The improved economic indicators from the Eurozone, particularly the positive sentiment index and industrial production results, may provide some support to the Euro. However, the upcoming high-impact events, including the European Central Bank’s President Christine Lagarde’s speech and key U.S. inflation data, could introduce volatility. Should Lagarde propose a more optimistic or hawkish tone on monetary policies, it may boost the Euro. Conversely, strong U.S. inflation data could strengthen the Dollar if it pressures the Federal Reserve to consider tightening monetary policy sooner, impacting the EURUSD rate negatively.

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What can we expect from EURUSD today?

EURUSD on Tuesday rose 0.1% to 1.08450. Price is above 9-Day EMA while Stochastic is falling in overbought zone.

Updated daily direction for EURUSD looks mixed as the pair is likely to consolidate above 1.08341 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.08487 or trades above daily pivot 1.08414. Break above could target R1 at 1.08523. While to the downside, we are looking at 1.08341 (S1) and daily low of 1.08305 as support levels. EURUSD need to break on either side to indicate a short-term bias. A break above 1.08487 may suggest continuation after recent positive movement.

For the week to-date, take note that EURUSD is mixed as compared to the prior week.

Key levels to watch out:

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