- EUR/USD rebounds to 1.1030 at the beginning of the week.
- Investors’ attention stays on US-China headlines.
- German ZEW survey in centre stage on Tuesday.
After a brief test of daily highs around 1.1030, EUR/USD has now re-shifted its focus to the lower end of the range in the 1.1020 zone.
EUR/USD focused on trade, data
The pair has attempted a recovery to the 1.1030 region earlier in the session, although the bullish move lacked of follow through.
In the meantime, investors remain focused on any headline regarding the US-China ‘Phase One’ deal, particularly after Friday’s comments by President Trump saying there is still no decision on any roll over of existing tariffs.
The down move in spot has been lately fuelled by the moderate recovery in the buck against the backdrop of raising US yields, always following trade news and the persistent sell off in the safe havens.
In the data space, the German Wholesale Price Index contracted at a monthly 0.1% in October and dropped 2.3% from a year earlier. Tomorrow, the key ZEW survey in Germany and the broader euro area will be in the limelight ahead of Thursday’s advanced Q3 GDP figures.
What to look for around EUR
The selling mood in the euro dragged spot to fresh 3-week lows in the 1.1020/15 band, where it is now looking to stabilize. As usual, the firm note in the greenback and developments from the US-China trade scenario are expected to dictate the mood around the pair for the time being. On the macro view, the outlook in Euroland remains fragile and does nothing but justify the ‘looser for longer’ monetary stance by the ECB and the bearish view on the single currency in the medium term at least. In addition, the possibility that the German economy could slip into recession in Q3 remains a palpable risk for the outlook and is expected to weigh further on EUR in the short/medium term horizon.
EUR/USD levels to watch
At the moment, the pair is gaining 0.05% at 1.1022 and faces the next hurdle at 1.1109 (100-day SMA) followed by 1.1179 (monthly high Oct.21) and finally 1.1186 (61.8% Fibo of the 2017-2018 rally). On the downside, a break below 1.1016 (monthly low Nov.11) would target 1.1000 (psychological handle) en route to 1.0925 (low Sep.3).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.