EUR/USD: Dovish Fed, China’s policy stimulus and likely Chinese economic stabilization may support upside - CitiBank

Matías Salord FXStreet

In their weekly strategy report, analysts at Citibank, explained that they pushed back the rate hike timing of the European Central Bank to the first quarter of 2021 after the latest meeting, which may undermine EUR.

Key Quotes:

“Investors are equally worried about the broader aggregate Eurozone data momentum and potential for recession risks. Eurozone current account surpluses, Chinese easing and fading US growth outperformance may underpin EUR in the medium and long term.”

“EUR/USD continued to retreat while Slow Stochastic did not follow with higher lows. A bottom divergence pattern may send EUR higher, with resistance at 1.1514 and support at 1.1177.”

“The dovish Fed, China’s policy stimulus and likely Chinese economic stabilization in 3Q may weaken USD in the medium and long term, which may support EUR.”

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.