- Greenback comes under modest selling pressure in last hour.
- US President Trump's comments on US-China trade conflict weigh on T-bond yields.
- EUR/USD remains on track to post weekly gains.
The EUR/USD pair gained traction into London fix and rose to a fresh daily high of 1.1218. As of writing, the pair was trading at 1.1215, adding 0.33% on the day and more than 100 pips since the start of the week.
Dollar looks to end week on a weak note
The uncertainty surrounding the US-China trade conflict seems to have forced investors to reposition themselves ahead of the weekend. While speaking to reporters earlier today at the White House, Trump said that next round of face-to-face talks with China was still scheduled to take place next month in Washington but responded "maybe" when asked if there was a possibility of that event getting cancelled.
The 10-year US Treasury bond yield broke below its tight daily range on these comments and erased more than 1% to weigh on the Greenback. The US Dollar Index, which spent the major part of the day moving sideways above 97.50, turned south and was last down 0.16% on the day at 97.42.
Focus shifts to European politics
On the other hand, political turmoil in Europe amid heightened odds of a snap election in Italy could make it difficult for the shared currency to add to its gains in the near-term.
Commenting on this development, "Polls suggest a significant gain for Lega and loss for M5S, but no part with an absolute majority. The odds are higher though than we end up with a new government entirely composed of the right-wing, lead by Lega," said TD Securities analysts.
"While EUR and Italian assets have taken this poorly, it would actually seem more likely this can spur more stability and less spending in the new government than at present, given the need to not please two parties with very different budget priorities.”
Technical outlook by FXStreet Analyst Yohay Elam
EUR/USD is suffering from downside momentum on the daily chart and has failed in its attempts to break above the 50 and 100-day Simple Moving Averages. The pair also remains below the 200 SMA.
Overall, bears are in control.
1.1180 provides some support after limiting the falls in August and also in mid-June. A more significant cushion awaits at 1.1165, which capped EUR/USD in early August. 1.1145 is a weak support line that worked as such in May. The former double-bottom of 1.1110 held it up twice in April and then in May. The next line is critical – the 2019 trough at 1.1027. The following line is 1.0900.
Some resistance awaits at 1.1250, which is the highest level in August so far. The triple-top of 1.1285, which has limited held EUR/USD down in mid-July is next. 1.1325 was the high point in April, and it is followed by 1.1345 that worked as both support and resistance in May. Next, we find 1.1390 and 1.1410.
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 steady below 1.0800 after US PCE meets expectations
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair barely reacted to US PCE inflation data, with the Greenback shedding some pips. Fed Chair Jerome Powell set to speak ahead of the weekly close.
GBP/USD hovers around 1.2620 in dull trading
GBP/USD trades sideways above 1.2600 amid a widespread holiday restraining action across financial markets. Investors took a long weekend ahead of critical United States employment data next week. Fed Chair Powell coming up next.
Gold price sits at all-time highs above $2,230
Gold price holds near a fresh all-time high at $2,236 in thinned trading amid the Easter Holiday. Most major world markets remain closed, although the United States published core PCE inflation, the Federal Reserve’s favorite inflation gauge.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.