EUR/USD continues to find a technical foothold, but downside pressure is mounting

• EUR/USD managed to keep a hold of 1.1050 on Tuesday, but action is tilted downside.
• US PMI figures that flubbed forecasts stoked a fresh bid into the Greenback.
• US NFP labor numbers due this week will be a guiding print for Fed rate cut depth.

EUR/USD tilted further into the low side on Tuesday, with intraday bottom bids testing into two-week lows before settling the day near 1.1050 once again. Price action remains limited as markets gear up for one last US Nonfarm Payrolls (NFP) print this week, but a flop in US ISM Purchasing Managers Index (PMI) figures reignited fears of an impending recession.

Forex Today: The prospects of a US soft landing remain challenged by data

Meaningful European data remains limited in the front half of the trading week, and Thursday will see Fiber traders with their hands full thanks to an update to pan-European Retail Sales in July followed by US preview labor figures before Friday's NFP jobs dump.

Pan-EU Retail Sales for the year ended in July are expected to recovery slightly, forecast to print at 0.1% YoY compared to the previous period's -0.3% decline. European Gross Domestic Product (GDP) figures are also slated for Friday, and growth is broadly expected to hold steady at previous figures in the second quarter.

ISM's US Manufacturing PMI for August came in below expectations, printing at 47.2 and missing the median market forecast of 47.5. Despite a soft rebound from July's multi-month low of 46.8 failed to galvanize markets, giving already flighty investors a perfect excuse to pull back from a recent lopsided tilt into bullish expectations.

Friday's US Nonfarm Payrolls (NFP) report looms large. It represents the last round of key US labor data before the Federal Reserve (Fed) delivers its latest rate call on September 18. Friday's NFP print is widely expected to set the tone for market expectations regarding the depth of a Fed rate cut, with investors fully priced in on the start of a new rate-cutting cycle this month.

EUR/USD price forecast

Fiber has slumped back into near-term technical barriers, but bidders continue to come out of the woodwork in an effort to keep bids on-balance even if they can't quite pull out a bullish recovery.. EUR/USD popped into a 13-month high just above 1.1200 early last week, and a near-term pullback in Greenback flows sees bids scrambling to hold onto bullish chart paper.

The pair is still trading well north of the 200-day Exponential Moving Average (EMA) at 1.0845. Despite holding deep in the bull country, EUR/USD is still facing a steepening bearish pullback as shorts congregate targets just above the 50-day EMA at 1.0956.

EUR/USD daily chart