EUR/USD: The time to turn down from 1.19 has come

FXStreet Team FXStreet

EUR/USD has been benefiting from Fed Powell's dovish comments but virus and fiscal concerns in Europe and profit-taking on Wall Street may trigger a setback, Yohay Elam, an Analyst at FXStreet, reports.

See: EUR/USD to plunge towards 1.15 in the second quarter as dollar's strength lingers – Credit Suisse

A refocus on the fundamentals may push EUR/USD lower

“While the Federal Reserve is focused on outcomes, not outlooks, and continues printing greenbacks, Powell's messages were not new. On Friday, investors already have a somewhat different view – the recovery in US Treasury yields have edged higher, underpinning the greenback and pushing EUR/USD under 1.19.”

“EUR/USD bears may have more to chew on in Europe. Isabel Schnabel of the European Central Bank warned that delaying EU fiscal aid would be a ‘catastrophe.’ She shed light on issues with distributing the already agreed New Generation funds.”

“The old continent's more significant issues come from covid. Cases remain elevated in Germany, France, and Italy, with Spain joining in with fresh post-Easter increases. Moreover, several EU countries have banned the usage of AstraZeneca's vaccines for most adults, potentially delaying immunization rollout.”

“Some support awaits at 1.1890, the daily low, followed by 1.1860, which cushioned the pair on Thursday. Resistance is at the April peak of 1.1925, followed by 1.1950 and 1.1990, the latter being a double top.”

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FXStreet Team

FXStreet

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