- EUR/USD witnessed some heavy selling on Wednesday and dropped to fresh weekly lows.
- A sharp fall in the equity markets underpinned the safe-haven USD and exerted pressure.
- Upbeat US Durable Goods Orders did little to influence as the focus remains on the FOMC.
The EUR/USD pair maintained its offered tone through the early North American session and had a rather muted reaction to the US macro data.
The pair failed to capitalize on the previous day's goodish intraday bounce, instead met with some fresh supply on Wednesday and might now be looking to extend the slide below the 1.2100 mark. A sharp fall in the equity markets forced investors to take refuge in the safe-haven US dollar, which, in turn, was seen as a key factor that prompted some heavy selling around the EUR/USD pair.
Investors turned cautious amid doubt about the timing and size of a new US economic stimulus package. This comes on the back of growing market worries about the potential economic fallout from the continuous surge in new coronavirus cases. Adding to this, escalating US-China tensions in the South China Sea further dented investors' confidence and contributed to the risk-aversion mood.
The strong intraday USD positive move could also be attributed to some repositioning trade ahead of the FOMC monetary policy decision, due later during the US session. On the economic data front, the US Durable Goods Orders came in to show a modest 0.2% rise in December as against 0.9% anticipated. The disappointing print, however, was offset by an upward revision of the previous month's reading.
Moreover, core durable goods orders (excluding transportation items) increased by 0.7% during the reported month as against 0.5% anticipated. The data did little to provide any meaningful impetus, albeit remained supportive of the strong bid tone surrounding the greenback. Meanwhile, the EUR/USD pair remained depressed near weekly lows as traders await Wednesday's key event for a fresh impetus.
Technical levels to watch
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 trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair keenly awaits the US PCE inflation data and Fed Chair Powell's speech for fresh hints on next week's price action.
GBP/USD holds steady above 1.2600 as markets stay calm on Good Friday
GBP/USD trades sideways above 1.2600 amid a typical Good Friday trading lull. A broadly firmer US Dollar could keep any upside attempts limited in the pair ahead of the US PCE inflation data and Fed Chair Powell's appearance.
Gold price sits at all-time highs above $2,230, US PCE eyed
Gold price hit all-time highs at $2,236 on Thursday to finish Q1 2024 with a bang. Most major world markets, including the US are closed due to Holy Friday, leaving volatility around Gold price highly subdued. US PCE inflation and Powell are awaited.
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.