- The shared currency advances 0.15% on the day.
- Geopolitical jitters seemed to be “ignored” by EUR/USD traders, which buoyed the EUR.
- EUR/USD Technical Outlook: Neutral but subject to breakouts to the upside or downside as it remains trapped between the 50-100 DMA.
During the North American session, the common currency extended its rally, up 0.40% on the week so far, amid uncertainty over the Russia/Ukraine conflict. At the time of writing, the EUR/USD is trading at 1.1379.
Russia-Ukraine conflict headlines dominate session
The conflict between Russia and Ukraine has kept the market mood in flux since last Friday, macroeconomic data aside. On Tuesday, Russian officials reported the withdrawal of troops near the Ukrainian border. However, developments in the past few hours suggested that ten new Russian battle groups approached the border, Estonian and Ukrainian intelligence reported, according to Reuters.
Meanwhile, the Federal Reserve released the Minutes from its January meeting. The minutes revealed that the US central bank would end QE in March, as planned at the December meeting. In addition, Fed policymakers would like to remove policy accommodation faster than they anticipate and would like to raise the Federal Funds Rate (FFR) “soon.”
However, the Committee stressed that they would continue to rely on data and monitor economic and financial developments. It is worth noting that Fed officials noted that “risks to inflation were outweighed to the upside,” as reported by Reuters.
Returning to EUR/USD, the pair reacted to the upside, heading to 1.1395, but geopolitical jitters slowed the move, then pulling back to the 1.1380 area.
EUR/USD Price Forecast: Technical Outlook
EUR/USD maintains a neutral bias, trading within the 50 and 100-day moving averages (DMA) at 1.1328 and 1.1403, respectively. With that being said, any break up/down from the previous DMAs can provide EUR/USD traders with a clear trend.
That being said, if EUR buyers recapture the 100 DMA, that will open the door for more gains. EUR/USD’s first resistance would be the Feb 11 daily high at 1.1430, followed by the Feb 4 high at 1.1483 and the Feb 10 high at 1.1494.
On the other hand, the break of the 50 DMA would send the EUR/USD towards 1.1300. The break of the latter would expose on December 15, 2021, 1.1221 daily low, followed by 1.1200.
Additional technical levels
Source: Fx Street
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