- The EUR/USD pair is strongly bullish in the short term. Further growth is natural if the DXY drops deeper.
- The US data could move the rate later today.
- Positive US figures should lift the greenback.
The EUR/USD price rallied in the short term as the USD weakened due to a better risk mood. The pair is trading at 1.0677 at the time of writing, far above today’s low of 1.0565.
Fundamentally, the price was expected to rebound as the USD took a serious hit from the CB Consumer Confidence yesterday. The economic indicator reached 102.9 points, far below the 108.5 expected and compared to 106.0 points in the previous reporting period.
Today, the German Unemployment Change and Final Manufacturing PMI came in worse than expected. Later, the US figures should move the markets. The ISM Manufacturing PMI is seen as a high-impact event, expected at 47.9 points, above 47.4 points in the previous reporting period.
Final Manufacturing PMI, Construction Spending, ISM Manufacturing Prices, and Wards Total Vehicle Sales data will also be released. Positive US data should boost the greenback. This scenario forces the currency pair to come back down. Poor economic data could announce a larger rebound.
EUR/USD price technical analysis: Strong rebound
Technically, the price escaped from the down channel pattern signaling an upside reversal in the short term. As you can see on the hourly chart, the rate retested the 1.0577 and the broken downtrend line before developing a new leg higher.
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Now, it has passed above the 23.6% retracement level and the R1 (1.0650). It’s almost to reach a strong supply zone around the 1.07 psychological level. It remains to see how it reacts around this resistance area.
The 38.2% (1.0723) stands as the next upside target. Still, after its strong rally, we cannot exclude a temporary drop in the short term. The price could return to test the immediate support levels before jumping higher.
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Saqib Iqbal 
Saqib Iqbal is a market analyst, prop fund trader and mentor, serving the industry with his analysis and educational content since 2011. The author has great exposure to different financial markets and institutions. He’s well-known for his day trading reviews and multiple timeframe analysis.
