EUR/USD drops as Sino-US tensions overshadow upbeat China exports

EUR/USD dips as losses in US stock futures lifts greenback.
President Trump orders the banning of Chinese social media apps.
SIno-US tensions overshadow the surge in Chinese exports, weigh over riskier assets.

Omkar Godbole FXStreet Contributor

EUR/USD is feeling the pull of gravity on Friday as the oversold dollar is drawing bids on US-China tensions.

The currency pair is trading at 1.1826, representing a 0.40% decline on the day, having failed to keep gains above 1.19 on Thursday.

Focus on Sino-US tensions

The US President Trump on Thursday signed an executive order to ban any transactions with ByteDance, the Chinese company that owns the video-sharing app TikTok, starting in 45 days. "We must take aggressive action against the owners of TikTok to protect our national security," Trump said in an order.

The move comes at a time when Washington and Beijing are already locked in a dispute over several issues like the origin of the coronavirus and democracy in Hong Kong.

As such, the risk sentiment is weakening, despite the upbeat China data released during the Asian trading hours. The futures tied to the S&P 500 are currently down 0.5% and the greenback is gaining ground against majors. The dollar index, which tracks the value of the greenback against majors, is trading at 93.14 at press time, representing a 0.4% gain on the day.

China’s dollar-denominated exports rose 7.2% in July, while imports fell 1.4% from a year ago, data from the country’s General Administration of Customs showed on Friday. The uptick in exports could be taken as a sign of improvement in global demand conditions.

Looking ahead, the pair may continue to take cues from the broader market sentiment apart from the German Industrial Production, due at 06:00 GMT, and the US July Nonfarm Payrolls figure, due at 12:30 GMT.

Technical levels

EUR/USD

Overview
Today last price	1.1826
Today Daily Change	-0.0052
Today Daily Change %	-0.44
Today daily open	1.1878

Trends
Daily SMA20	1.1613
Daily SMA50	1.1399
Daily SMA100	1.1144
Daily SMA200	1.1103

Levels
Previous Daily High	1.1916
Previous Daily Low	1.1818
Previous Weekly High	1.1909
Previous Weekly Low	1.1642
Previous Monthly High	1.1909
Previous Monthly Low	1.1185
Daily Fibonacci 38.2%	1.1879
Daily Fibonacci 61.8%	1.1856
Daily Pivot Point S1	1.1825
Daily Pivot Point S2	1.1772
Daily Pivot Point S3	1.1726
Daily Pivot Point R1	1.1923
Daily Pivot Point R2	1.1969
Daily Pivot Point R3	1.2022

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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