EUR/USD Daily Forecast – Test Of Support At 1.1990

EUR/USD Video 05.05.21.

Euro Is Under Pressure

EUR/USD is currently testing the support at 1.1990 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index has recently managed to get above the 20 EMA at 91.35 and is moving towards the 50 EMA at 91.50. In case the U.S. Dollar Index manages to settle above the 50 EMA, EUR/USD will find itself under more pressure.

Today, foreign exchange market traders will have a chance to take a look at the final readings of Services PMI reports from EU and U.S. Euro Area Services PMI is projected to increase from 49.6 in March to 50.3 in April. Numbers above 50 show expansion, so Euro Area services segment is expected to return to growth. In the U.S., Services PMI is projected to grow from 60.4 to 63.1.

U.S. ADP Employment Change report may also have an impact on the dynamics of the U.S. dollar. Analysts expect that the report will indicate that U.S. businesses hired 800,000 workers in April.

Technical Analysis

eur usd may 5 2021

EUR/USD managed to settle below the support at the 20 EMA at 1.2020 and is testing the next support level which is located near the 50 EMA at 1.1990. RSI remains in the moderate territory, and there is plenty of room to gain additional downside momentum in case the right catalysts emerge.

If EUR/USD settles below the 50 EMA, it will head towards the next support level which is located at 1.1965. A successful test of the support at 1.1965 will push EUR/USD towards the next support at 1.1925. In case EUR/USD declines below this level, it will move towards the support at 1.1900.

On the upside, the previous support at the 20 EMA at 1.2020 will serve as the first resistance level for EUR/USD. If EUR/USD settles above this level, it will head towards the next resistance at 1.2040. A move above the resistance at 1.2040 will open the way to the test of the next resistance level which is located at 1.2060.

For a look at all of today’s economic events, check out our economic calendar.