EUR/USD edges higher to approximately 1.1585 in the early European session on Wednesday. The pair maintains a positive perspective above the 100-day SMA, supported by bullish RSI momentum. The first upside barrier emerges at 1.1614; the initial support level to watch is 1.1570. The EUR/USD pair is positioned in positive territory close to 1.1585 during the early European trading hours on Wednesday. The Euro edges higher against the US Dollar as the German ZEW survey beat forecasts. The President of the European Central Bank, Christine Lagarde, is scheduled to deliver remarks later on Wednesday.
Data released on Tuesday indicated that the German ZEW Survey – Economic Sentiment registered at 34.2 in August, an improvement from the previous figure of 26.3, surpassing the anticipated estimate of 30.00. The ZEW Survey – Current Situation shows an improvement to -61.1 in August, up from -77.6 in July, surpassing the anticipated -68.8. Financial markets are currently anticipating an ongoing trajectory of interest rate increases by the ECB. The ECB Watch Tool suggests a 90% to 94% likelihood of a 25 basis points (bps) increase to 2.50% at the upcoming policy meeting set for September 9. Analysts note that the recent shift in US Dollar sentiment, driven by last week’s data releases that have “helped ease Fed rate hike expectations,” has yet to trigger any meaningful liquidation of long Dollar positions.
They point out that “DXY remains supported above the 200-day moving average level of 99.185,” underscoring that the softer policy outlook has not translated into “any great sell-off” in the Dollar index. In the daily chart, EUR/USD maintains a bullish near-term bias as the spot price remains above the 100-day moving average and the Bollinger middle band, indicating a positive underlying trend following a recovery from the lower band support around 1.1364. Momentum remains favourable, as indicated by the Relative Strength Index (14) at 63.8, suggesting that buyers maintain their influence while nearing overbought conditions without fully committing to that zone.
On the topside, initial resistance is defined by the August 17 high of 1.1614. The next hurdle is identified at the Bollinger upper band near 1.1650, where attempts to move higher may begin to encounter resistance. On the downside, immediate support is observed at the 100-day moving average at 1.1570, followed by the middle band of the Bollinger Bands at 1.1505. A deeper pullback would target the recent floor at the Bollinger lower band around 1.1365 to maintain the broader upturn.
