The Euro to dollar exchange rate is in an uptrend from the 1.1580 swing low, and it seems like EUR/USD might soon test or break 1.2000 in the near term.
There were decent gains in the shared currency during the past few days, and the exchange rate settled above the 1.1800 support area. At the moment, the pair is correcting lower, but remains well supported on the downside near 1.1820 and 1.1780.
The US GDP figure was released today by the US Bureau of Economic Analysis with the forecast of +3.2%. However, the actual was a bit higher, as the US GDP grew 3.3%.
The impact was a bit bearish on almost all dollar pairs and EUR/USD moved down a bit. However, it might be limited considering the pair is approaching crucial supports near 1.1800.
Can Euro to Dollar Retain Bullish Momentum?
Looking at the 4-hours chart of the Euro to Dollar, there was a nice upside move from the 1.1580 swing low. The EUR/USD pair moved above the 1.1900 level and traded close to the 1.1970 level.
A high was formed at 1.1962 from where the pair has started a correction. It has moved below the 38.2% Fib retracement level of the last wave from the 1.1720 low to 1.1962 high.
However, the pair is approaching a major support near a crucial bullish trend line at 1.1820 on the 4-hours chart. Moreover, the 50 simple moving average (orange, 4-hour) is at 1.1825 to act as a decent support.
The 61.8% Fib retracement level of the last wave from the 1.1720 low to 1.1962 high is at 1.1809, which is another support. Therefore, it seems like the 1.1800 handle holds a lot of importance going forward.
If the pair stays above 1.1800, starts a new upside wave, then there is a chance that the pair might retest the 1.1960 level. It could even break the stated 1.1960 level to test the all-important 1.2000 handle in the near term.
US Gross Domestic Product (GDP) Q3 2017 and Impact on EUR/USD
Today, the US saw a major economic release, as the Gross Domestic Product Annualized preliminary reading for Q3 2017 was published by the US Bureau of Economic Analysis.
The market was looking for a rise of 3.2% in the GDP, more than the last +3.0%. The actual was a bit higher, as the US GDP grew 3.3%.
The report mentioned that:
Real gross domestic income (GDI) increased 2.5 percent in the third quarter, compared with an increase of 2.3 percent (revised) in the second. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 2.9 percent in the third quarter, compared with an increase of 2.7 percent in the second quarter.
The US Dollar moved higher after the release, but the market sentiment could favor risk after the release. Therefore, the pairs like EUR/USD and GBP/USD might recover after a minor dip.
In the cryptocurrencies arena, bitcoin price rocketed above the $10,000 level and it looks set for more gains above the $10,500 level. Ethereum’s Ether price moved higher and traded above the $500.00 level for the first time. It looks like ETH/USD might accelerate gains in the near term.
EUR/USD Support Levels
1.1800 And 1.1780
EUR/USD Resistance Levels
1.1900 And 1.1960