The euro is trading lower but rising from its lows on Thursday as US Treasury yields rose and investors bet on a relatively hawkish Federal Reserve.

The common currency had risen in recent weeks, with inflation data and comments from the Federal Reserve suggesting that it may soon slow the pace of its interest rate hikes. Expectations of aggressive rate hikes by the European Central Bank (ECB) are also giving the euro a boost.

At 19:00 GMT, EUR/USD is trading at 1.0365, down 0.0029 or -0.28%. The Invesco CurrencyShares Euro Trust (FXE) ETF is at $95.65, down $0.27 or -0.28%.

U.S. Treasury yields rose sharply on comments from key Fed speakers on inflation and the pace of further interest rate hikes from the central bank, St. Louis Federal Reserve Chairman, James Bullard said on Thursday that the central bank’s interest rate hikes had had “only limited effects”. on observed inflation.

EUR/USD daily

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 1.0480 will signal a resumption of the uptrend. A move through .9730 will change the main downtrend.

The minor trend is also up. A trade through .9936 will change the minor downtrend. This will shift the momentum down.

The main resistance area is 1.0366-1.0560. It stopped buying at 1.0480 on Tuesday.

The minor range is 0.9936 to 1.0480. Its pivot at 1.0208 is the closest support. This is followed by a short term level of 50% at 1.0076.

Daily Swing Chart Technical Forecast

Traders’ reaction to the 50% level at 1.0366 is likely to determine the direction of EUR/USD at Thursday’s close.

Downside scenario

A sustained move below 1.0366 will indicate the presence of sellers. If this move creates enough downside momentum, expect selling to eventually extend to the minor pivot at 1.0208.

Bullish scenario

A sustained move above 1.0366 will signal the presence of buyers. If that generates enough bullish momentum, expect the rally to eventually lead to a retest of 1.0480.

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