EUR/USD Current Price: 1.1788
- US President Trump signed four executive orders on coronavirus relief.
- The EU will publish the August Sentix Investor Confidence, foreseen at -15.2 from -18.2.
- EUR/USD decline corrective on the broader view but could extend its slump in the shorter-term.
The greenback closed the week appreciating against most major rivals, although EUR/USD settled in the 1.1780 price zone, holding on to modest weekly gains. The dollar got boosted by US President Trump´s announcement on executive orders and after an encouraging monthly employment report. The US administration imposed sanctions on Hong Kong’s chief leader, Carrie Lam, and ten other senior officials for their roles in the political turmoil in the region, also anticipating fiscal stimulus executive orders, which finally came on Saturday. The US Congress has been trying to reach an agreement on the matter for two weeks already, to no avail. The four orders extend unemployment benefits by $400, suspends the collection of payroll taxes till December, stop evictions from rental housing that has federal financial backing and extend zero per cent interest on federally financed student loans.
As for employment data, according to the Nonfarm Payroll report, the US added 1.76 million jobs in July, while the unemployment rate decreased to 10.2%, both figures better than anticipated. The numbers had a limited impact once out, as they reflect the long way to recovery the country still faces. In the last three months, the country recovered only 42% of the job positions lost in March and April. The US won’t publish relevant data this Monday, but the EU will unveil the August Sentix Investor Confidence, foreseen at -15.2 from -18.2 in the previous month.
EUR/USD short-term technical outlook
The EUR/USD pair has closed above the 23.6% retracement of its 1.1184/1.1915 rally at 1.1742, the immediate support level. Daily basis, the latest decline seems corrective, as the pair continues to develop above a firmly bullish 20 DMA, which converges with the 38.2% of the mentioned advance at 1.1630, while technical indicators are barely retreating from overbought readings. In the 4-hour chart, and for the shorter-term, however, the risk is skewed to the downside, as the pair has broken below its 20 SMA, while technical indicators have entered bearish territory, the Momentum maintaining its downward slope.
Support levels: 1.1740 1.1700 1.1660
Resistance levels: 1.1810 1.1850 1.1900
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