EUR/USD drops to 1.1135 after a spike to 1.1180
|- Euro erases most of its daily gains versus US Dollar and Pound.
- EUR/USD heads for another negative month, a different story in June?
The EUR/USD pair pulled back over the last hours after a spike to 1.1179. The Euro fell more than 40 pips from the day’s top and dropped to 1.1135. As of writing trades at 1.1145, far from the top but still in positive territory for the day.
The sudden move in EUR/USD is likely due to month-end flows at the London-fix. The Euro also dropped against the Pound. Equity prices in Wall Street moved off lows over the last hours but global concerns remain in place. The key driver today was the announcement of US tariffs to all Mexican products starting in June of 5%.
Lowest weekly close since 2017?
The Euro is about to end the week with a modest decline and if it ends under 1.1140 it will post the lowest weekly close in two years. “The EUR/USD pair is poised to close the week around 1.1140, with the long-term bearish trend intact. The weekly chart shows that the pair keeps developing below a daily descendant trend line coming from September 2018 high at 1.1622, which falls at 1.1285 for the upcoming week,” said Valeria Bednarik, Chief Analyst at FXStreet. She adds the 20-week SMA continues heading lower “above the current level and below the larger ones, below the mentioned trend line.”
On a monthly basis, the euro is headed toward the fifth monthly decline in-a-row. June will start with a busy week in terms of the economic calendar. Over the last decade, June has been more of a positive month for the Euro versus the US Dollar. If EUR/USD manages to rise over the last 30 days, it could finally post a monthly gain for 2019.
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