EUR/USD flirting with daily highs around 1.1140

EUR/USD pushes higher to the 1.1140 region on Thursday.
Coronavirus fears, US Payrolls prompt cautiousness among traders.
US Claims, Factory Orders next of note in the NA session.

Pablo Piovano FXStreet

The buying interest appears to have returned to the single currency in the second half of the week, with EUR/USD trading close to the area of 1.1140, or daily peaks.

EUR/USD focused on data, coronavirus

EUR/USD is alternating gains with losses in the 1.1140 zone following the opening bell in Euroland on Thursday, all against the backdrop of a generalized consolidative mood in the global markets.

Indeed, market participants as well as volatility appear to be taking a breather in the second half of the week following recent volatile sessions, particularly in response to the unexpected 50 bps rate cut by the Federal Reserve on Tuesday.

In the meantime, and with coronavirus fears still unabated, investors continue to look to the G7 central banks in order to gauge the probability of further easing measures (mainly via interest rate cuts) aimed to tackle the impact of the coronavirus outbreak on the economy.

Absent data releases or events in the euro docket, the focus of attention will shift to the US data space, where Factory Orders and the weekly report on the US labour market are due along with Unit Labor Costs and Non-farm Productivity.

What to look for around EUR

EUR/USD came under pressure following weekly/monthly tops beyond the 1.1200 mark. In the meantime, the ECB remains vigilant and ready to act in case the outlook deteriorates further in response to the coronavirus and particularly after the Fed cut rates on Tuesday. On another front, the ECB is expected to finish its “strategic review” (announced at its January meeting) by year-end, leaving speculations of any change in the monetary policy before that time pretty flat. Further out, recent better-than-expected results in both Germany and the broader Euroland appear to have re-ignited some optimism among investors regarding the possibility of some recovery in the region and the currency. This view is also supported by rumours of fiscal stimulus in Germany.

EUR/USD levels to watch

At the moment, the pair is gaining 0.04% at 1.1138 and a breakdown of 1.1097 (200-day SMA) would target 1.1037 (55-day SM) en route to 1.0992 (monthly low Jan.29). On the flip side, the next hurdle lines up at 1.1213 (weekly/monthly high Mar.3) seconded by 1.1239 (monthly high Dec.31 2019) and then 1.1249 (monthly high Aug.6 2019).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

AUD/USD sits near monthly high, around 0.7035 on hawkish RBA

AUD/USD trades around 0.7030-0.7035 in the Asian session on Thursday, near its monthly top, as recent hawkish comments from RBA officials continue to underpin the Australian Dollar. The US Dollar, meanwhile, struggles to lure buyers amid further declines in US bond yields, adding support to the pair. However, Fed rate-hike bets and geopolitical uncertainty help limit losses for the safe-haven buck, warranting caution for Aussie bulls.

USD/JPY remains confined in a familiar range; holds steady above 158.00

USD/JPY extends its consolidative price action through Thursday's Asian session, trading just above 158.00 amid diverging forces. Uncertainty over the timing of the next BoJ rate hike keeps Japanese Yen bulls on the defensive. The US Dollar, meanwhile, languishes near multi-week low amid declining US bond yields. Furthermore, looming intervention risks limit JPY losses and cap the pair. Traders also seem hesitant ahead of the Fed and BoJ meetings next week.

Gold hangs near one-week low; eyes $4,100 break amid Fed hike bets

Gold attracts fresh sellers in Thursday’s Asian session, sliding closer to a one-week low touched the previous day. Firming expectations for an imminent Fed rate hike, bolstered by oil-driven inflation risks, weigh on the non-yielding bullion. Meanwhile, declining US bond yields counter geopolitical uncertainty, keeping US Dollar bulls on the defensive. This helps XAU/USD defend $4,100.

Dogecoin Labs launches, resistance looms

Dogecoin (DOGE) Labs launched Wednesday in partnership with the Dogecoin Foundation, bringing together several product teams and technologies to expand the use of the memecoin (DOGE) across payments, decentralized finance (DeFi) and consumer applications. The launch will consolidate MyDoge, DogeOS and Such App under one business, led by Jordan Jefferson, founder of MyDoge and DogeOS.

What the midterm elections mean for Treasury yields, the Dollar and Gold

Democrats are priced to take the House, so November 3 comes down to the Senate and how much Washington can borrow without the other party. Treasury yields will show the answer first, then the Dollar and Gold. On November 3, Americans vote for all 435 House seats and 35 Senate seats. For bond prices, the result comes down to one thing: how much the government will borrow over the next two years.

The US Dollar fell. Gold didn't rally. That tells you everything

Gold (XAU/USD) is struggling to capitalize on a weaker US Dollar (USD), after repeatedly failing to establish itself above the $4,200 level. The precious metal remains confined to a relatively narrow trading range despite a combination of developments that would normally support higher prices.