Euro remains under pressure around 1.1130

• Euro trades close to weekly lows near 1.1130 against the US Dollar.
• Stocks in Europe open Friday’s session in a mixed fashion.
• EUR/USD risks further decline in the short-term horizon.
• US, EMU calendars will be empty at the end of the week.

The Euro (EUR) navigates within a tight range against the U.S. Dollar (USD) at the end of the week and relegates EUR/USD to remain under scrutiny in the low-1.1100s.

The strong Dollar’s rally this week has driven the pair sharply lower from its 2023 high near 1.1270 last Monday down to Thursday's lows in the 1.1120/1.1115 band.

Other than some profit taking in light of the pair’s recent strong advance, market chatter suggesting the Federal Reserve may not end its rate hiking campaign in July has also boosted the Dollar at the expense of risk assets. 

Looking ahead, spot seems set for some consolidation ahead of crucial meetings next week by the Federal Reserve and European Central Bank (ECB). While both central banks are likely to raise rates by 0.25%, an emerging divergence lies in their near-term plans regarding future tightening.

Furthermore, the Fed is seen as nearing the end of its hiking cycle, while some ECB officials have sounded less hawkish recently on the prospects for more hikes beyond summer.  

In bond markets, yields on both sides of the Atlantic trade without direction so far today in Europe.

Daily digest market movers: Euro looks depressed and could challenge 1.1100

• The EUR maintains the trade near 1.1100 against the USD.
• The USD Index remains bid and approaches 101.00.
• Speculation that the Fed could end its hiking cycle in July looks mitigated.
• US, German lack clear direction so far on Friday.
• The BoJ defended its current ultra-accommodative stance.
• Retail Sales in the UK came in above expectations in June.

Technical Analysis: Euro faces a decent support around 1.1000

EUR/USD continues to digest the so far marked weekly pullback.

The pair printed a new 2023 high at 1.1275 on July 18. Once this level is cleared, there are no resistance levels of significance until the 2022 peak of 1.1495 recorded on February 10.

On the downside, immediate contention lies at the weekly low of 1.1118 (July 20) ahead of the psychological 1.1000 mark, all seconded by provisional support at the 55-day and 100-day SMAs at 1.0897 and 1.0881, respectively. The loss of this region could open the door to a potential visit to the July low of 1.0833 (July 6) ahead of the key 200-day SMA at 1.0687 and the May low of 1.0635 (May 31). South from here emerges the March low of 1.0516 (March 15) before the 2023 low of 1.0481 (January 6).

Furthermore, the constructive view of EUR/USD appears unchanged as long as the pair trades above the key 200-day SMA.