- The EUR/USD opens the week by consolidating previous gains.
- Italy's budget, fresh Turkish concerns outweigh hope for a US-Chinese trade resolution.
- The chart shows the pair is trading in an upwards channel.
The EUR/USD is trading above 1.1400 but below the highs and down on the day. The pair shot higher on Friday on reports that the US and China are working on a roadmap to resume trade talks. The US Dollar was sold off on the optimism. A fresh report suggests that the world's largest economies are aiming to reach an agreement in November.
However, another issue from the previous week is not fully resolved. The Turkish Lira remains under pressure as the central bank refuses to raise interest rates. The CBRT took measure to make lending more expensive, and the country received an emergency loan from Qatar. However, the trouble is far from over. President Recep Tayyip Erdoğan upped the ante by saying that an attack on the economy is like an attack on the flag. Some euro-zone banks are exposed to Turkey, and there is fear of contagion to other emerging markets.
Italy is also in the limelight. The euro zone's third-largest economy is still reeling from the collapse of the bridge near Genova, a disaster that left many dead. The nation now wants to spend €80 billion in infrastructure, thus breaching EU budgetary rules. This could put the government at loggerheads with Germany and France.
The German Producer Price Index came out at 0.2%, and Germany remains the center of attention in a relatively calm day. The German central bank, the Bundesbank, releases its monthly report and its president Jens Weidmann speaks later on.
EUR/USD Technical Analysis
-636703498151739759.png)
The EUR/USD is trading in an upwards channel (thick black lines on the chart). This began after the pair bottomed out at 1.1300. The recent moves put uptrend support in danger.
Momentum remains positive, and the Relative Strength Index is marginally above 50. The pair is challenging the 50 Simple Moving Average on the four-hour chart.
Resistance awaits at 1.1450 which capped the pair in its recent ascent. Further up, the previous 2018 low of 1.1508 is the next level to watch. 1.1530 held the pair from falling in early August and remains essential.
1.1365 was a low point in mid-August before the price plunged all the way to 1.300, which is the next level to watch. Below, we are back to rates last seen in July 2017, with 1.1225 being the most noteworthy level.
More: EUR/USD has a clear trading range in the wake of the new week – Confluence Detector
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. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD remains above 1.0700 amid expectations of Fed refraining from further rate hikes
EUR/USD continues to gain ground on Thursday as the prevailing positive sentiment in the market provides support for risk-sensitive currencies like the Euro. This improved risk appetite could be attributed to dovish remarks from Federal Reserve Chairman Jerome Powell on Wednesday.
GBP/USD gains traction above 1.2500, Fed keeps rates steady
GBP/USD gains traction near 1.2535 during the early Thursday. The uptick of the major pair is supported by the sharp decline of the US Dollar after the US Federal Reserve left its interest rate unchanged.
Gold needs to reclaim $2,340 for a sustained recovery
Gold price is consolidating Wednesday’s rebound in Asian trading on Thursday, as buyers await more employment and wage inflation data from the United States for fresh trading impetus. Traders also digest the US Federal Reserve interest rate decision and Chair Jerome Powell's words delivered late Wednesday.
Top 3 Price Prediction BTC, ETH, XRP: Altcoins to pump once BTC bottoms out, slow grind up for now
Bitcoin reclaiming above $59,200 would hint that BTC has already bottomed out, setting the tone for a run north. Ethereum holding above $2,900 keeps a bullish reversal pattern viable despite falling momentum. Ripple coils up for a move north as XRP bulls defend $0.5000.
Fed meeting: The hawkish pivot that never was, and the massive surge in the Yen
The Fed’s latest meeting is over, and the tone was more dovish than expected, but that is because the rate hike hype in the US was over-egged, and rate cut hopes had been pared back too far in recent weeks.