EUR/USD analysis: weaker dollar lifts the common currency

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1641

US tax reform seen coming in 2019, dollar hit.
EU on track to grow at its fastest pace in a decade this year.

The greenback sagged this Thursday, on speculation that the US tax reform would be delayed one year. The American currency attempted to recover some ground at the beginning of the US session, but poor data, alongside with confirmations on the tax delay, sent it back down. The EUR/USD pair rose to its highest for the week at 1.1654 and settled near it jumping on headlines indicating that Senate Republicans plan to propose delaying a cut in the US corporate tax until 2019. The House Republicans discussed earlier in the day the possibility of applying the tax reform in 2018, but the debate couldn't prosper, as the total amount the cut implies is beyond what they are permitted under budget rules. The US released its weekly unemployment claims report, which showed that In the week ending November 4 initial claims were 239,000, an increase of 10,000 from the previous week's unrevised level of 229,000. In Europe, on the other hand, the European Commission Autumn forecast, showed that the euro area economy is on track to grow at its fastest pace in a decade this year, with real GDP growth forecast at 2.2% up from previous 1.7%, while the EU economy as a whole is also set to beat expectations with robust growth of 2.3% this year, revised 1.9% in spring.

The pair holds on to its intraday gains, short-term poised to extend its advance according to technical readings in the 4 hours chart, as indicators head north well into positive territory, while the price recovered above its 20 SMA, now slowly turning higher around 1.1600. In the wider picture, however, the upward potential is still limited, given that the price is below the 1.1660region, where it bottomed since early August and until the end of October. Spikes towards 1.1690 were quickly reversed last week, with the pair unable to settle above the key resistance area. That said, the EUR/USD pair could only enter in a bullish stage on a recovery beyond the 1.1720 region.

Support levels: 1.1550 1.1510 1.1460

Resistance levels: 1.1660 1.1690 1.1720

View Live Chart for the EUR/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

GBP/USD surges to multi-day peaks past 1.3250

GBP/USD leaves behind Friday’s small pullback and advances past 1.3250 level, or five-day highs, on Monday. Cable’s upside follows extra losses in the Greenback, while traders continue to assess the geopolitical front and upcoming key events.

EUR/USD softens to near 1.1400 as ECB tightening bets fade

The EUR/USD pair trades with mild losses around 1.1415 during the early Asian session on Tuesday. The Euro softens against the US Dollar as traders reduce their bets on the European Central Bank rate hikes this year.

Gold tumbles 1.5% to fresh seven-month lows below $3,950

Gold remains under strong selling pressure for the second straight day early Tuesday, refreshing seven-month lows below $3,950. Renewed US-Iran hostilities over the weekend cast doubts over the sustainability of the peace deal. This, along with elevated expectations for Fed rate hikes, offers some support to the US Dollar and undermines the bullion.

Bitcoin stalls at $60K as buyer conviction fades, Strategy authorizes BTC sales

Bitcoin is trading around the $60,000 level on Monday after a sharp decline last week. With the top crypto struggling to recover, analysts suggest the market remains firmly in defensive territory as investors await stronger signs of demand.

Just like Fed, is BoJ’s independence under threat?

When talking about central bank independence, most of the focus has been on Donald Trump’s pressure on the Federal Reserve. But a similar story, a quieter one for now, seems to be happening on the other side of the Pacific: Japan’s government may be testing the Bank of Japan’s independence.

Kevin Warsh isn't expected to say much in Sintra: That's exactly why markets will listen

Financial markets could find an important catalyst in the enchanting, fairytale-like landscape of Sintra this week. The ECB Forum will, as it does every year, gather the crème de la crème of central banks. The new boss at the Fed, who has clearly said that the Fed should stop explaining everything, will need to talk – and traders should listen.