- Federal Reserve Chairman Jerome Powell will testify before Congress in the US session.
- The United States ADP survey on job creation posted 140K in February, missing expectations.
- EUR/USD tepid advance skews the risk to the upside in the near term.
The EUR/USD pair marched north on Wednesday, reaching a two-week high of 1.0879 during European trading hours. The uptick is modest but relevant as the pair seemed comfortable above the 1.0865 threshold, the 38.2% Fibonacci retracement of the latest daily slump. The better tone of Asian and European stock markets after Wall Street’s setback on Tuesday weighed on the American currency ahead of critical macroeconomic events.
Meanwhile, the US Super Tuesday, in which primary elections were held in several states, ended up with former President Donald Trump standing up victorious against his rival Nikki Haley, who announced she will suspend her presidential campaign. Across the Republican primaries, Haley won just 43 of the Republican delegates, while Trump won 764. On the Democratic party front, President Joe Biden led the voting, with no surprises on that front.
Data-wise, better-than-anticipated Eurozone Retail Sales underpinned the Euro. Sales were up 0.1% MoM in January and down 1% from a year earlier, against the -1.3% expected. Across the pond, the United States (US) published MBA Mortgage Applications, which increased by 9.7% in the week ended March 1. Additionally, the ADP report on private job creation showed 140K new positions were added, below the expected 150K. The US will later release the JOLTS Job Openings January report, while Federal Reserve (Fed) Chairman Jerome Powell will testify about the Semi-Annual Monetary Policy Report before the House Financial Services Committee.
The EUR/USD pair retains early gains ahead of Wall Street’s opening. In the daily chart, EUR/USD holds above all its moving averages, which remain directionless and between 1.0800 and 1.0830, reflecting the absence of a clear trend. Technical indicators gave mixed signals, as the Momentum indicator turned south within positive levels amid a soft start to the day, while the Relative Strength Index (RSI) indicator aims north at around 58, reflecting the intraday advance.
For the near term, the 4-hour chart shows that a bullish 20 Simple Moving Average provided intraday support, currently at 1.0847, maintaining its bullish strength above directionless longer ones. Technical indicators, on the other hand, remain within positive levels, although they are losing their upward strength. Overall, the risk skews to the upside, although investors are waiting for additional confirmation.
Support levels: 1.0840 1.0795 1.0750
Resistance levels: 1.0910 1.0950 1.1000