EUR/USD Forecast: More gain the docket amid broad dollar’s weakness

EUR/USD Current Price: 1.1834

• EU inflation jumped to 1.6% YoY in August, according to preliminary estimates.
• Investors await US CB Consumer Confidence, expected to have contracted to 122.9.
• EUR/USD trades at its highest in almost a month and is set to keep advancing.

The EUR/USD pair extended its advance to 1.1844, its highest in four weeks, trading nearby ahead of the US opening, as speculative interest keeps selling the greenback, despite a souring market’s mood. The shared currency found support in upbeat local data, as the German Unemployment rate contracted to 5.5% in August, while the EU Consumer Price Index was confirmed at 1.6% YoY in August, and according to preliminary estimates.

The pair holds on to gains around 1.1830, despite European indexes trade in the red, dragging lower US futures. The US will publish August CB Consumer Confidence, foreseen at 122.9 from 129.1 previously, and the Chicago Purchasing Managers’ Index for the same month, expected at 68 from 73.4 in the previous month.

EUR/USD short-term technical outlook

The EUR/USD pair trades above the 61.8% retracement of its latest decline, the immediate support level at 1.1820. The near term picture favors additional gains, as, in the 4-hour chart, the pair develops above all of its moving averages, with the 20 SMA heading firmly higher and crossing above the longer ones. Technical indicators reached overbought levels, partially losing their bullish strength but without indicating a change in the current bias.

 Support levels: 1.1820 1.1880 1.1745  

Resistance levels: 1.1850 1.1890 1.1825

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