EURUSD Technical Outlook (Daily)
EURUSD: The financial world is still focused on the Brexit referendum Thursday, with mixed results coming from polls marginally favoring the remain side, and keeping risk sentiment on.
Generally speaking, high yielder’s end up gaining Vs the Buck, while safe haven assets fell, although the EURUSD fell to 1.1242, and remained nearby at the end of the day, filling the weekly opening gap.
On 2 separated events, Central Banks’ heads, Draghi from the ECB and Yellen from the US Fed, gave testimony of the ongoing monetary policies before government commissions, offering cautious approaches ahead of the UK referendum.
The Fed Chairwoman Janet Yellen noted that the US economy picked up during Q-2 of this year, adding that low interest rates and job gains will likely support consumer spending, and a the same time cautioning about the anemic economy.
Mr. Draghi said that the economy is expected to proceed at a moderate, steady pace, but added that inflation is expected to hover at low levels, and therefore “further stimulus is in the pipeline,” this last triggering EUR’s decline.
Trading a few pips above the mentioned daily low, the 4 hours for the EURUSD shows that the technical indicators have pared losses around their mid-lines, indicating the Southward potential is limited, despite the intra-day decline. In the same chart, the price is currently below a Bullish 20-Day SMA, which converges with the 38.2% Fibo retracement of the May’s decline, acting as 1st resistance at 1.1295.
The EURUSD will probably continue trading on sentiment rather than technical studies as the Key UK date looms large, with investors turning more cautious Wednesday and keeping most major assets range bound.
Support marks:1.1245 1.1210 1.1160
Resistance marks: 1.1295 1.1330 1.1365