The EUR/USD started the week by testing a strong resistance cluster near 1.0900. It was expected that the pair would be kept down by various technical resistance levels.
Economic Calendar Analysis
Data that might impact the EUR/USD is bound to start being released on Thursday at 07:30 GMT. At that time, the German Markit Flash Manufacturing and Services PMIs are bound to be released. The pair could move around 20 pips on the announcement.
Afterwards, at 08:00 GMT the Euro Zone PMIs could also cause a move of around 20 base points. Prior to the coronavirus crisis, the event caused moves around five pips in five minutes. In fact a five pip move during five minutes on the EUR/USD is considered as a reduced volatility period.
On the same day, at 12:30 GMT, the US Unemployment Claims are scheduled to be released. Most likely, the event would reveal another major decline in US employment.
Also on Thursday, at 13:45 US Manufacturing PMI could cause a move, as in February and March it created 32.5 and 23.0 pip moves.
Last but not least, a notable reaction of above then pips could be created by the US Durable Goods orders.
EUR/USD hourly chart's review
During Friday morning, the EUR/USD currency pair tried to surpass the resistance level formed by the Fibo 23.60% at 1.0886. During today's morning, the pair was testing the same level.If the given resistance level holds, it is likely that a reversal south could occur in the nearest future. Note that the exchange rate could gain support from the 55-hour SMA near 1.0860.
If the given support holds, it is likely that that the Euro could trade sideways against the US Dollar in the short run. Otherwise, the currency pair is likely to target the psychological level at 1.0820.
Hourly Chart
On the daily candle chart, the rate bounced off the resistance of the 55-day simple moving average, which is located at the 1.0970 level.
In regards to the future, the pair was expected to test the support of the 1.0780 level, which caused reversals of the rate's direction in February and April
Daily chart
Read More: Technical Analysis
Short sentiment increases
On Friday, 73% of open EUR/USD position volume on the Swiss Foreign Exchange was in short positions.
By the middle of Monday's GMT trading hours, the sentiment was 75% short.
Traders had been short throughout the previous week, as the rate bounced off the resistance of the 55-day SMA.