EUR/USD could have a difficult time pushing higher in the near-term

EUR/USD has managed to rebound following Wednesday's sharp decline. As FXStreet’s Eren Sengezer notes, the pair approaches key resistance area that could cap the upside as investors await key data releases from the US.

Euro closes in on resistance area that could limit recovery

“The US private sector employment report published by the ADP will be watched closely by market participants. Considering how the upbeat data helped the dollar find demand on Wednesday, a similar market reaction could be witnessed if the data suggest that the US economy remains in a good spot with tight labor market conditions.”

“1.07 (psychological level) aligns as interim resistance ahead of 1.0720 (20-period SMA, 50-period SMA). In case the pair rises above the latter and starts using it as support, the next recovery target could be seen at 1.0740 (static level). Until that happens, the bullish pressure is unlikely to gather momentum.”

“1.0680 (Fibonacci 23.6% retracement of the latest uptrend) could be seen as first support. With a four-hour close below that level, sellers could show interest and drag the pair toward 1.0660 (static level) and the 1.0630/1.0620 area (Fibonacci 38.2% retracement, 200-period SMA).”