Published on May 5, 2023

Daily Analysis For EUR/USD 05-05-2023

EUR/USD Analysis

Economic Events and Scenario for EUR/USD

Economic Events: -

GMT	Event	Impact	Currency
01:00	(Japan) International Children's Day	None	JPY
01:00	(Netherlands) Liberation Day	None	EUR
02:30	(Australia) Home Loans MoM	Medium	AUD
02:30	(Australia) Investment Lending for Homes	Medium	AUD
02:30	(Australia) RBA Statement on Monetary Policy	Medium	AUD
02:45	(China) Caixin Composite PMI	Low	CNY
02:45	(China) Caixin Services PMI	High	CNY
06:45	(Switzerland) Unemployment Rate	High	CHF
07:00	(Germany) Factory Orders MoM	Medium	EUR
07:30	(Switzerland) Inflation Rate MoM	Low	CHF
07:30	(Switzerland) Inflation Rate YoY	Medium	CHF
07:30	(Switzerland) CPI	High	CHF
07:45	(France) Industrial Production MoM	Medium	EUR
07:45	(France) Private Non Farm Payrolls QoQ	Low	EUR
08:00	(Austria) Wholesale Prices YoY	Low	EUR
08:00	(Austria) Wholesale Prices MoM	Low	EUR
08:00	(Austria) Balance of Trade	Low	EUR
08:00	(Slovakia) Retail Sales YoY	Low	EUR
08:00	(Slovakia) Retail Sales MoM	Low	EUR
08:00	(Spain) Industrial Production YoY	Low	EUR
08:00	(Switzerland) Foreign Exchange Reserves	Low	CHF
08:30	(Euro Area) S&P Global Construction PMI	Low	EUR
08:30	(France) S&P Global Construction PMI	Low	EUR
08:30	(Germany) S&P Global Construction PMI	Medium	EUR
08:30	(Italy) S&P Global Construction PMI	Low	EUR
09:00	(Italy) Retail Sales MoM	High	EUR
09:00	(Italy) Retail Sales YoY	High	EUR
09:30	(Slovenia) Balance of Trade	Low	EUR
09:30	(United Kingdom) S&P Global/CIPS Construction PMI	Medium	GBP
10:00	(France) New Car Registrations YoY	Low	EUR
10:00	(Euro Area) Retail Sales YoY	High	EUR
10:00	(Euro Area) Retail Sales MoM	High	EUR
11:00	(Luxembourg) Inflation Rate YoY	Low	EUR
11:00	(Luxembourg) Inflation Rate MoM	Low	EUR
11:00	(Spain) Consumer Confidence	Medium	EUR
13:30	(Canada) Average Hourly Wages YoY	Low	CAD
13:30	(Canada) Full Time Employment Chg	Medium	CAD
13:30	(Canada) Part Time Employment Chg	Medium	CAD
13:30	(Canada) Participation Rate	Medium	CAD
13:30	(Canada) Employment Change	High	CAD
13:30	(Canada) Unemployment Rate	High	CAD
13:30	(United States) Manufacturing Payrolls	Low	USD
13:30	(United States) Nonfarm Payrolls Private	High	USD
13:30	(United States) Non Farm Payrolls	High	USD
13:30	(United States) Unemployment Rate	High	USD
13:30	(United States) Government Payrolls	Low	USD
13:30	(United States) Participation Rate	Medium	USD
13:30	(United States) Average Weekly Hours	Low	USD
13:30	(United States) Average Hourly Earnings MoM	Medium	USD
13:30	(United States) Average Hourly Earnings YoY	Medium	USD
14:30	(United States) Used Car Prices MoM	Low	USD
14:30	(United States) Used Car Prices YoY	Low	USD
15:00	(Ecuador) Inflation Rate YoY	Low	USD
15:00	(El Salvador) Inflation Rate YoY	Low	USD
15:00	(El Salvador) Inflation Rate MoM	Low	USD
18:00	(United States) Baker Hughes Oil Rig Count	Low	USD
18:00	(United States) Baker Hughes Total Rig Count	Low	USD
20:00	(United States) Consumer Credit Change	Low	USD

Today's Scenario: - During the Asian trading session, the EUR/USD pair has made a solid recovery, climbing back above 1.1040. This can be attributed to the US Dollar index (DXY) continuing its downward trajectory. The major currency pair is attempting to bounce back from Thursday's decline, which was influenced by the European Central Bank's (ECB) announcement of a smaller interest rate hike.

The USD Index has dropped even further, now falling below 101.20. This is due to the lack of supportive economic indicators and the presence of several negative factors that are weighing on the index. The delay in raising the US debt ceiling and the mounting banking crisis are among these factors. Furthermore, the Federal Reserve's (Fed) decision to base their monetary policy actions on data dependency has undermined the USD Index's primary support.

Buy Scenario: - Currently, the EUR/USD pair is being supported by the ascending trend line from Tuesday and the 100-bar Exponential Moving Average (EMA) around 1.1010. The steady RSI and an impending bull cross on the MACD also suggest a potential rebound. However, the pair must overcome the 200-EMA hurdle, which sits around 1.1025, to convince intraday buyers. Even then, the resistance area around 1.1030-35, which has been in place for two weeks, is likely to provide a challenge for EUR/USD bulls.

It is worth noting that an upward-sloping resistance line from mid-April, which is close to 1.1095, could also restrict any short-term further upside of the Euro pair, followed by the round figure of 1.1100, till we do not advise to buy EUR/USD currency pair.

Sell Scenario: - On the other hand, if the EUR/USD pair experiences a pullback, it would need to breach both the 1.1010 support confluence and the round figure of 1.1000 to convince sellers. If this happens, multiple support levels near 1.0980 and 1.0940 can challenge Euro bears before directing them towards the previous monthly low of around 1.0790. Till then we do not advise selling EUR/USD.

Support and Resistance Level: -