EUR/USD Price Forecast: Euro forms potential higher low above 100-day SMA

EUR/USD sees sharp two-way price swings on Friday after a stronger-than-expected United States (US) employment report triggers fresh volatility. The pair initially fell to an intraday low of 1.1585 before recovering as the US Dollar (USD) struggled to sustain its gains. At the time of writing, EUR/USD trades around 1.1620.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.10 after climbing as high as 99.36 following the employment report.

Technical analysis

On the daily chart, EUR/USD remains trapped between the 100-day Simple Moving Average (SMA) at 1.1564 and the 200-day SMA at 1.1634, leaving the pair in a narrow consolidation range.

The broader price structure retains a modest bullish bias. EUR/USD has formed a sequence of higher highs and higher lows since recovering from below 1.1400 in late July and reaching 1.1711 on August 21. The latest price action suggests that another higher low may be developing above the 100-day SMA, although buyers still need to clear the 200-day average to regain control.

The Relative Strength Index (RSI) has eased from the overbought levels reached around the August 21 high but holds above the neutral 50 mark at approximately 56, indicating that bullish momentum has weakened without disappearing entirely.

Meanwhile, the Moving Average Convergence Divergence (MACD) remains marginally below zero, pointing to a mild bearish bias. However, the fading red histogram bars suggest that downside momentum is losing strength.

On the upside, a break above the 200-day SMA near 1.1634 could pave the way toward the 1.1700 mark, followed by the more distant resistance zone around 1.1800.

On the downside, immediate support emerges at the 100-day SMA around 1.1564, followed by the 50-day SMA near 1.1508. A deeper decline would expose the horizontal support region around 1.1400.