EUR/USD hovers just under 1.1150 as traders await key US data
I reckon it's very much going to be a wait-and-see session in the European morning as traders brace themselves for the release of the US Q1 GDP report later today. EUR/USD sellers hold control in the near-term with price hovering well below the key hourly moving averages but the pair did bounce off bids near key support around 1.1110 in overnight trading.
For now, buyers will need to navigate a break above the 100-hour MA (red line) @ 1.1198 to stand any chance of retracing higher. Otherwise, sellers will continue to exert control and look for an extension lower next week.
The daily chart clearly shows that the bias in the pair remains to the downside but there is support lurking nearby around 1.1110 and 1.1060 (downwards trendline).
That said, sentiment this week continues to favour the dollar so just be wary of that in the event that US data later fails to offer much change to the current picture. I reckon any minor retracement in EUR/USD towards the 100-hour MA and the 1.1200 will encounter tough resistance and sellers will be poised to lean against those levels to keep price within their control in the near-term.
But if the data later disappoints heavily (anything under 1.8% would fall in this jurisdiction in my view), expect a selloff in the dollar into the weekend as traders will also look towards profit taking from the recent rally in the greenback. Should that be the case, I reckon USD/JPY is where the bulk of the action will reside as dismal growth in the US will see markets fearing a deepening in the global economic slowdown.
