- ECB jawboning, US dollar gains weigh heavily on EUR/USD.
- Focus shifts to the ECB Sintra Forum for fresh direction.
The EUR/USD pair fell sharply to test Monday’s lows near 1.1530 levels in a knee-jerk reaction to the comments from the ECB Governing Council members Nowotny and Villeroy. Nowotny jawboned the common currency, citing that he sees the Euro depreciating against the US dollar while Villeroy said that he doesn’t see any rate hike until the summer of 2019.
The spot managed to quickly reverse the dip and reverted to the familiar range near 1.1570 region, having found some support from the recovery in the German 10-year yields. Recall that the German 10-year yields hit fresh three-week lows of 0.350% a day before, in the wake of escalating US-Sino trade tensions induced risk aversion.
However, the latest move higher appears to have lost legs on the back of broad-based US dollar strength and amid increased nervousness ahead of the ECB Central Banking Forum in Sintra.
Top central banks’ Heads are scheduled to participate in a panel discussion due at 1330 GMT, with the key highlight likely to be the remarks from the Fed Chair Powell and ECB Chief Draghi, which could reinforce the divergent monetary policy outlooks between both continents.
Meanwhile, markets keep a close eye on the flattening US 2yr-10-yr yield curve, which is expected to invert soon. The expectations of an inverted yield curve could emerge EUR-supportive in the coming days.
EUR/USD Technical Levels
Yohay Elam, FXStreet’s Analyst notes: “The trend is bearish with Momentum pointing down and the RSI still above 30, avoiding oversold territory. The pair also trades below the 50-day and 200-day Simple Moving Average. The grind lower continues. Support is found around 1.1530-1.1540, the low levels the pair traded at on Tuesday and on Friday. The 2018 low of 1.1510 is a strong line of support. Further down, 1.1480 is a veteran line from July 2017. Looking up, 1.1610 was a swing low early in the month. 1.1650 capped the pair on Tuesday and was also the May 25th low. 1.1730 served as support last week.”
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
AUD/USD hovers around 0.6500 amid light trading, ahead of US GDP
AUD/USD is trading close to 0.6500 in Asian trading on Thursday, lacking a clear directional impetus amid an Anzac Day holiday in Australia. Meanwhile, traders stay cautious due ti risk-aversion and ahead of the key US Q1 GDP release.
USD/JPY finds its highest bids since 1990, approaches 156.00
USD/JPY broke into its highest chart territory since June of 1990 on Wednesday, peaking near 155.40 for the first time in 34 years as the Japanese Yen continues to tumble across the broad FX market.
Gold stays firm amid higher US yields as traders await US GDP data
Gold recovers from recent losses, buoyed by market interest despite a stronger US Dollar and higher US Treasury yields. De-escalation of Middle East tensions contributed to increased market stability, denting the appetite for Gold buying.
Ethereum suffers slight pullback, Hong Kong spot ETH ETFs to begin trading on April 30
Ethereum suffered a brief decline on Wednesday afternoon despite increased accumulation from whales. This follows Ethereum restaking protocol Renzo restaked ETH crashing from its 1:1 peg with ETH and increased activities surrounding spot Ethereum ETFs.
Dow Jones Industrial Average hesitates on Wednesday as markets wait for key US data
The DJIA stumbled on Wednesday, falling from recent highs near 38,550.00 as investors ease off of Tuesday’s risk appetite. The index recovered as US data continues to vex financial markets that remain overwhelmingly focused on rate cuts from the US Fed.