Sentiment continues to drive the pair that recovered ground over Asian hours amid Nikkei adding over a 3.0% on the day, putting safe havens dollar and yen under pressure across the board. The pair advanced up to 1.3850 with the European opening, albeit another round of weak inflation readings in the EU has halted the advance. EU CPI yearly basis came out at 0.5% as expected, its lowest level since November 2009, adding pressure on the ECB now expected to act on next May meeting.
The ongoing crisis in Ukraine escalated over these last few days, and news from the region are pretty confusing. Despite market has been mostly ignoring it, its an increasing risk factor for the FX market, and risk aversion runs should not be dismissed so easily in the days to come.
Technically, the EUR/USD 4 hour chart shows price now retracing back to its 20 SMA that maintains a bearish slope, while indicators failed around their midlines and turn slightly south, giving little support to an upward continuation. Immediate support comes around the 1.3810 area, and if below, the pair may attempt to retest the 1.3780/90 area, while only below this last bears will win the intraday battle and be able to push it further down, towards 1.3720/30 price zone.
On the other hand, a price acceleration above daily high should lead to a continued advance up to 1.3890, where the pair will finally fill the weekly opening gap.
View Live Chart for EUR/USD
The ongoing crisis in Ukraine escalated over these last few days, and news from the region are pretty confusing. Despite market has been mostly ignoring it, its an increasing risk factor for the FX market, and risk aversion runs should not be dismissed so easily in the days to come.
Technically, the EUR/USD 4 hour chart shows price now retracing back to its 20 SMA that maintains a bearish slope, while indicators failed around their midlines and turn slightly south, giving little support to an upward continuation. Immediate support comes around the 1.3810 area, and if below, the pair may attempt to retest the 1.3780/90 area, while only below this last bears will win the intraday battle and be able to push it further down, towards 1.3720/30 price zone.
On the other hand, a price acceleration above daily high should lead to a continued advance up to 1.3890, where the pair will finally fill the weekly opening gap.
View Live Chart for EUR/USD
Recommended Content
Editors’ Picks
AUD/USD holds hot Australian CPI-led gains above 0.6500
AUD/USD consolidates hot Australian CPI data-led strong gains above 0.6500 in early Europe on Wednesday. The Australian CPI rose 1% in QoQ in Q1 against the 0.8% forecast, providing extra legs to the Australian Dollar upside.
USD/JPY sticks to 34-year high near 154.90 as intervention risks loom
USD/JPY is sitting at a multi-decade high of 154.88 reached on Tuesday. Traders refrain from placing fresh bets on the pair as Japan's FX intervention risks loom. Broad US Dollar weakness also caps the upside in the major. US Durable Goods data are next on tap.
Gold price struggles to lure buyers amid positive risk tone, reduced Fed rate cut bets
Gold price lacks follow-through buying and is influenced by a combination of diverging forces. Easing geopolitical tensions continue to undermine demand for the safe-haven precious metal. Tuesday’s dismal US PMIs weigh on the USD and lend support ahead of the key US macro data.
Crypto community reacts as BRICS considers launching stablecoin for international trade settlement
BRICS is intensifying efforts to reduce its reliance on the US dollar after plans for its stablecoin effort surfaced online on Tuesday. Most people expect the stablecoin to be backed by gold, considering BRICS nations have been accumulating large holdings of the commodity.
US versus the Eurozone: Inflation divergence causes monetary desynchronization
Historically there is a very close correlation between changes in US Treasury yields and German Bund yields. This is relevant at the current juncture, considering that the recent hawkish twist in the tone of the Fed might continue to push US long-term interest rates higher and put upward pressure on bond yields in the Eurozone.