The US dollar dropped sharply across the board after the FBI said that it uncovered new emails related to the closed investigation into whether Hillary Clinton mishandled classified information. EUR/USD rose from 1.0935 to 1.0990, hitting the highest level in a week.
The pair was trading at 1.0975/80, 80 pips above Thursday’s closing price and consolidation above the 1.0935 resistance zone, that capped the upside on the previous two trading days.
With the recent rally, the pair is now headed toward the first weekly gain after losing ground in the previous three. The euro is extending the recovery after hitting the lowest level since March at 1.0850 on Tuesdays.
Will it last?
The decline of the US dollar so far means an important, an maybe unexpected, correction, considering it took place during the second half of Friday’s American session and also after the release of better—than-expected US GDP data.
Next week, the political campaign, after today’s FBI revelation could have a large impact on the currency market, that will surely also be affected by the FOMC decision (Wednesday) and the US employment report (Friday).
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