The EUR/USD price bounced back as investors reflected on the value of the US dollar as treasury bonds rose. The pair rose to a high of 1.2095, which is relatively higher than this week’s low of 1.2020.
What happened: The EUR to USD price bounced before the US published weak jobless claims numbers. The numbers raised the possibility of another major stimulus package by the United States, which pushed the yields of long and short-dated bonds.
Today, the pair will react to the important US existing home sales numbers and the EU and US flash manufacturing and services PMI data. Economists expect the data to show that the US manufacturing sector continued to flourish this month.
EUR/USD technical outlook
The four-hour chart shows that the EUR/USD price dropped to a low of 1.2020 this week. This price was slightly below the 23.6% retracement level. It then bounced back yesterday and reached the 38.2% Fibonacci retracement level.
The price has also moved above the 25-day and 15-day weighted moving averages. Still, in my view, I suspect that the pair has moved up so fast and that some bears will come in. Therefore, there is a possibility that it will retreat to about 1.2050.