EUR/USD Current Price: 1.1192

  • ECB's Draghi mentioned a 'lingering uncertainty' as a reason behind his dovish words.
  • US Trump and Chinese XI-Jinping agreed to meet within the G-20 meeting later this month.

The shared currency fell sharply this Tuesday, hit by comments from ECB's President, Mario Draghi, and disappointing macroeconomic data which gave context to Draghi's words. The leader of the European Central Bank spoke at the ECB Forum on Central Banking in Sintra and said that further interest rate cuts remain part of the central bank's tools, leaving doors opened for more stimulus, signaling that policymakers would act if inflation doesn't give signs of picking up. Following his speech, Germany released the June ZEW Economic Sentiment Indicator, which plunged to -21.1 for the country and to -20.2 for the whole Union. According to the official report, the sharp drop “coincides with an increased uncertainty regarding the future development of the global economy and substantially worsened figures for the German economy at the beginning of the second quarter.”

News indicating that Trump and Xi-Jinping agreed to meet within the next G-20 meeting underpinned risk appetite, with stocks worldwide cheering some light at the end of the tunnel in the trade war front, and the possibility of lower rates in the EU. The greenback remained strong against the EUR, this last weighed by Draghi's words.

This Wednesday, the US Federal Reserve will have its monetary policy meeting. Market participants are expecting some dovish shift in the wording, paving the way for a rate cut as soon as next July. However, Retail Sales released late last week and the relief in the trade front, may keep policymakers in 'patient' mode, which will end up benefiting the greenback even more.

The EUR/USD pair is finishing the day below the 61.8% retracement of its latest bullish run at around 1.1205, a level that was unable to recover post-Draghi. Technical readings in the 4 hours chart suggest that the decline could continue during the upcoming sessions, as the pair is now below all of its moving averages, with the 200 SMA providing a dynamic intraday resistance a few pips above the mentioned Fibonacci level, and the 20 SMA still heading south above the larger ones. Technical indicators in the mentioned chart had resumed their decline after a modest recovery, keeping their negative slopes close to oversold levels.

Support levels: 1.1180 1.1145 1.1105

Resistance levels: 1.1210 1.1250 1.1285

View Live Chart for the EUR/USD

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.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD remains depressed but off daily lows

The EUR/USD pair is recovering from a daily low of 1.1216, although holding in negative territory for the day. US preliminary Michigan Consumer Sentiment Index improved by less-than-anticipated in July, coming in at 98.4 vs. the 98.5 expected.

EUR/USD News

GBP/USD trading marginally lower daily basis but above 1.2500

The Pound gave back some of its Thursday’s gain on dollar’s relief. The GBP/USD pair broke a daily descendant trend line coming from June’s high and holds above it, leaving little room for sellers to act.

GBP/USD News

USD/JPY: bears pausing, still in control

Japanese National Inflation steady at 0.7%YoY in June. US Michigan Consumer Sentiment Index expected at 98.5 in July. USD/JPY corrective advance falling short of signaling an interim bottom in place.

USD/JPY News

Something has spooked the Fed

We wish we knew what it is. Wild talk of the US joining Japan and Europe with zero or negative return on the 10-year is or should be very frightening.

Read more

Gold consolidates around $ 1440, eyes US data for fresh direction

Gold (futures on Comex) extends its side-trend around the 1440 mark into the mid-European session, having stalled its retreat from 2019 highs of 1454 near 1437 region.

Gold News

Majors

Cryptocurrencies

Signatures