Chart of the day - EURUSD (21.04.2023)

EURUSD is pulling back this morning. The move lower is driven mostly by strengthening of the US dollar. The main currency pair tried to recover some losses after the release of mixed PMIs for France and Germany that showed major improvement in the services sector and significant deterioration in manufacturing. While flash PMIs failed to trigger a strong recovery move, they seem to have been enough to halt declines.

Taking a look at EURUSD at the H1 interval, we can see that the pair dropped to the 1.0940 area, where the short-term upward trendline can be found. Bulls managed to defend this price zone and now we can see the pair trying to climb back above 1.0950. From a technical point of view, this is a bullish development but whether this translates into a large upward impulse will depend on whether bulls manage to break above the 1.0980 resistance zone that has been limiting upward moves this week. Should such a break occur, EUR bulls may target recent highs in the 1.1070 area next.

The pair may see some volatility around 2:45 pm BST when flash PMIs from the United States for April are released. Market expects a small deterioration in both manufacturing and services.

Source: xStation5