- EUR/USD is up over 1% on a week-to-date basis.
- The single currency could put an end to its two-week trend of losses.
- With European data docket empty, the pair is at the mercy of the stock markets and the US data.
While EUR/USD has pulled back from two-week highs registered on Thursday, the currency pair still looks set to end its two-week losing trend.
At press time, the pair is trading near 1.0946, having hit a high of 1.0973 during Thursday's American session. That was the highest level since April 15.
Despite the pullback, the currency pair is up over 1% on a week-ot-date basis. If that gain is held through Friday's GMT close, the resulting weekly rise would be the first since early April. The pair fell by 0.45% last week and by 0.56% in the preceding week.
The pennant breakdown seen on the dollar index's daily chart suggests the greenback is likely to stay on the defensive while heading into the weekly close. Additionally, Federal Reserve's decision to expand its Main Street lending facility to accommodate larger businesses with a lower minimum loan size could weigh over the US dollar.
That said, big gains in EUR/USD could remain elusive as the S&P 500 futures are pointing to risk aversion with a 1.4% drop. The stock futures seem to have come under pressure due to Trump's comments on China and the resulting fears of a trade war and of deeper downturn in the US economy.
Also, the dollar may pick up a bid, forcing EUR/USD to trim weekly gains, if the US ISM Manufacturing data for April, due at 13:45 GMT, blows past expectations. That said the probability of the data printing below estimates is higher, as the coronavirus outbreak brought both the US and the global economy to its knees in April.
Technical levels
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