Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

EUR/USD Extends Recovery From Five-Year Low, Posts Second Weekly Gain In A Row

By Alex BoltyanForexMay 27, 2022 02:31PM ET
www.investing.com/analysis/eurusd-extends-recovery-from-fiveyear-low-posts-second-weekly-gain-in-a-row-200624982
EUR/USD Extends Recovery From Five-Year Low, Posts Second Weekly Gain In A Row
By Alex Boltyan   |  May 27, 2022 02:31PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The EUR/USD pair was correcting lower on Friday after posting its highest level in a month at 1.0765 during the European session. The euro failed to sustain the bullish momentum above the 1.0750 resistance area and it was trading around 1.0710-20.

Still, the shared currency was poised to record a 1.4% weekly gain, the second in a row, extending its bounce from the five-year low of 1.0348 struck on May 9.

On Friday, U.S. data showed that the Core PCE Price Index—the Federal Reserve’s preferred gauge of inflation—rose by 4.9% in May (annualized), easing down from the 5.2% rate printed in April. This could be a sign that inflation is close to peak (or even might have already done so).

Earlier this week, the Fed published the minutes of its May meeting, which showed FOMC members bracing for two more 50 bps rate hikes. But, if inflation proves to be slowing down, the bank might take a more gradual approach to avoid taking an unnecessary toll on growth.

On Thursday, U.S. GDP figures showed the economy contracted by 1.5% in the first quarter, more than the preliminary estimate of 1.4%.

Meanwhile, the European Central Bank has continued hinting at the beginning of the hiking cycle, as soon as July, which along with a technical correction, has helped the euro to recover from five-year lows.

From a technical viewpoint, the EUR/USD pair holds a negative bias according to the weekly chart. Both the RSI and the MACD remain in negative territory although the bearish momentum seems to be dwindling.

EUR/USD Weekly Chart
EUR/USD Weekly Chart

However, the pair retains the positive tone in shorter-term charts. The daily indicators favor an upward continuation, but EUR/USD might need to break decisively above 1.0750 to attract more buyers.

In that case, a descending trendline drawn from February, currently at 1.0815, would become a significant resistance level ahead of the 1.0900 area.

On the other hand, the 1.0640 zone stands as immediate support followed by the 1.0600 level and the 20-day SMA around 1.0560.
EUR/USD Daily Chart
EUR/USD Daily Chart

EUR/USD Extends Recovery From Five-Year Low, Posts Second Weekly Gain In A Row
 

Related Articles

Kenny Fisher
Yen In Calm Waters Ahead Of Inflation By Kenny Fisher - Jun 27, 2022

Japan has seen inflation move higher, although nowhere near the levels in the US or the UK, which are not far from double-digits. Last week, core CPI for May came in at 2.1% YoY,...

EUR/USD Extends Recovery From Five-Year Low, Posts Second Weekly Gain In A Row

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email