EUR/USD has been recovering amid temporary market calm. But, expected strong US figures, stimulus progress and America's vaccine ramp-up are set to boost the greenback, Yohay Elam, an Analyst at FXStreet, reports.
See: EUR/USD to strengthen with vaccine rollout in the second quarter – CIBC
Key quotes
“Economists expect the ISM Services Purchasing Managers' Index to print 58.7 points in February – prolonged growth in America's largest sector. The Manufacturing PMI smashed estimates earlier in the week with 60.8. Ahead of ISM's release, ADP's employment figures are forecast to show an increase of 177,000 private-sector jobs.”
“While the old continent is struggling to get people to take the AstraZeneca jab, the US is ramping up the rollout and also production. Merck agreed to produce Johnson and Johnson's single-shot inoculations and President Joe Biden stated that every American could be offered a vaccine by the end of May.”
“The Senate will begin debating Biden's $1.9 trillion covid relief package on Wednesday. While the president urged lawmakers to leave as much as possible unchanged, some elements such as the minimum wage hike will likely fall out of the legislation passed by the House. Nevertheless, advancing stimulus will likely add propping up the greenback.”
“Euro/dollar continues suffering from downside momentum on the 4-hour chart and trades below the 50, 100 and 200 Simple Moving Averages – which are all converging around the 1.2110 level. That critical confluence is a make or break point for the pair.”
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