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EURUSD: euro, other major currencies remain on back foot

The EURUSD pair tumbled 0.17% to 1.1578 on Thursday, September 30. The single currency looked steady ahead of the European opening. Price action sank to 1.1568 due a decrease in the EURGBP cross pair and an increase in the DXY index. Sellers pushed the key pair to an intraday low of 1.1563 during the North American session.

Despite the UK fuel crisis, the GBPUSD pair managed to recover 102 pips to 1.3517 after US macro data came out. Traders have been taking profit on short positions and dips in the pair over the past few sessions.

Meanwhile, initial jobless claims rose from 351,000 last week to 362,000 vs. the median forecast that called for 335,000.

US GDP accelerated to 6.7% in Q2 on the back of pandemic relief money from the government, which boosted consumer spending. Q3 ended on Thursday, so the final assessment for Q2 was of little interest to traders and investors.

Macro data slightly weakened the dollar. The DXY index recovered to 94.42 after declining to 94.12. The dollar drew support from high UST yields, as well as retreating stock indices.

Today’s macro agenda (GMT 3)

  • From 10:30 to 11:30 Europe: manufacturing PMIs in Switzerland, France, Germany, Eurozone, and UK (September)
  • 12:00 Eurozone: inflation rate (September)
  • 15:30 US: personal spending and income (August), and PCE price index (August)
  • 16:45 US: manufacturing PMI (September)
  • 17:00 US: ISM manufacturing (September), construction spending (August), University of Michigan consumer sentiment
  • 20:00 US: Baker Hughes weekly oil rig count

Current outlook

By the time of writing this review, major currencies were trading in the red, except for the yen and franc. The steepest losses were seen in the aussie (-0.42%) and the loonie (-0.40%). EURUSD is trading at Thursday's closing level. Buyers are trying to raise the price action amid the EUR/cross rally after yesterday's pullback, but so far there is a lack of incentive.

This morning, market participants are focused on EU PMIs. The US will release the ISM manufacturing index for September, as well as the UoM consumer sentiment index. There is plenty of key data, so volatility will be running high ahead of the weekend.

Technical analysis

The price went up over the last hour, with the 10-year UST yield and the S&P 500 in decline. On the one hand, the euro has gained support, but on the other hand, the stock market is creating a hindrance.

Monthly and quarterly candlesticks closed lower. Buyers were unable to defend the 1.1600 level, so they lost control of the situation. The door is open for sellers to head for the vicinity of ​​1.12 on the older TFs. Euro selling could resume at any time.

Technically, the hourly TF at 1.1563 shows a double bottom. A recovery is supported by cross pair allies. At the end of the week, sellers could take a breather. If the news flow is negative for the dollar, price action could retrace to 1.1610. Under the worst-case scenario, the euro might drop as low as 1.1535.

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