• EUR/USD keeps moving higher as the greenback remains under heavy selling pressure.
  • Potential easing from the Fed at the July meeting (50 bps cut?) keep weighing on the sentiment surrounding the buck along with some lower-than-expected results from the US docket.
  • Geopolitical effervescence around US-Iran stays unabated ahead of the key G-20 meeting in Japan on June 28-29.

The march north in EUR/USD remains everything but abated so far at the beginning of the week, extending the upside to the doorsteps of the key 1.1400 the figure.

As usual, markets’ perception of rate cuts by the Federal Reserve as early as the July meeting keeps hurting the mood around the greenback. The buck accelerated its downside on Friday after Minneapolis Fed N.Kashkari favoured a 50 bps rate cut next month. Market’s reaction appears quite exaggerated and traders may be forgetting that Kashkari is a non-voter member and his mega-dovish views are already well known. In the same line and also reinforcing the view of a weaker Dollar, it is true that recent figures from US fundamentals coupled with the ongoing inversion of the yield curve have been collaborating with the pessimism lingering over the US economy.

However, the current up move in EUR/USD could well be corrective only. This is quite possible because the shared currency faces some problems in its own backyard, namely the palpable probability that the ECB could cut rates in the near term and/or restart the QE scheme. In this environment, it is quite reasonable to think that there is no essence for a sustainable move above, say, 1.1500 in the next months. If we add that the ongoing slowdown in Euroland is expected to last longer, well, that just confirms the bearish scenario for EUR once this post-FOMC dust finally settles.

 

Let’s go to the technical view. EUR/USD, charted a bullish ‘outside candle’ in the weekly chart, opening the door for further strength in the near term and reinforcing at the same time the potential up move to the 1.1450 area, or March tops. The recent breakout of the key 1.1350 region, where coincide the 200-week and 200-day SMAs, has given extra oxygen to the pair and also adds to a move higher in the short-term horizon. When and if the 1.1450 area is cleared, spot should re-focus on 2019 highs in the 1.1570/80 band. 

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 hovers around 1.1130 in dull session, ECB eyed

The EUR/USD pair has recovered from a fresh weekly low of 1.1105 but remains depressed. Market players now waiting for ECB’s monetary policy, the last one presided by Mario Draghi.

EUR/USD News

GBP/USD attempting to recover after parliament slowed down the Brexit process

GBP/USD is moving up toward 1.29, trying to recover after parliament rejected the fast-track process that PM Johnson wanted for approving his Brexit deal. An extension to Article 50 and elections are on the cards.

GBP/USD News

USD/JPY struggles below mid-108.00s, over one-week lows

The Greenback held weaker against its Japanese counterpart, with the USD/JPY pair struggling below mid-108.00s, or over one-week lows set earlier this Wednesday.

USD/JPY News

If you are a "Hodler" here is where you could find support in Bitcoin

Today the price of Bitcoin fell and the price is now headed toward the 7,310.00 support used as a resistance zone on the week of the 3rd September 2018.

Read more

Gold climbs higher toward $1,500 on risk-aversion

The XAU/USD pair gained traction on Wednesday and rose toward the upper-limit of its two-week-old range near the critical $1,500 handle supported by risk-off flows.

Gold News

Forex Majors

Cryptocurrencies

Signatures