EUR/USD experiences major recovery

Source: Dukascopy Bank SA


Since Tuesday, US central bankers have made comments that they could cut interest rates. In addition, incoming data for various sectors confirms that the Federal Reserve could reduce rates. Moreover, the head of the Fed Jerome Powell has commented that easing could be done, if inflation continues to ease. Due to this reason, the US Dollar has declined in value.

On the EUR/USD charts these events have resulted in a surge, which has broken resistance at 1.0780 and the 1.0800 mark. On Thursday morning, the pair confirmed the 1.0840 level as support and extended the surge, aiming at the 1.0900 mark. The rate could surge to this level, before the Friday's US employment data publication.

A move above the 1.0900 mark and the weekly R2 simple pivot point at 1.0904 is expected to face resistance in the 1.0940 level and the weekly R3 at 1.0943.

On the other hand, a decline is set to look for support in the weekly R1 at 1.0847 and the 1.0840 level, before reaching the combination of the 50, 100 and 200-hour simple moving averages and the weekly simple pivot point near the 1.0800 mark.
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