EUR/USD has been benefiting from Fed Powell's dovish comments but virus and fiscal concerns in Europe and profit-taking on Wall Street may trigger a setback, Yohay Elam, an Analyst at FXStreet, reports.
See: EUR/USD to plunge towards 1.15 in the second quarter as dollar's strength lingers – Credit Suisse
A refocus on the fundamentals may push EUR/USD lower
“While the Federal Reserve is focused on outcomes, not outlooks, and continues printing greenbacks, Powell's messages were not new. On Friday, investors already have a somewhat different view – the recovery in US Treasury yields have edged higher, underpinning the greenback and pushing EUR/USD under 1.19.”
“EUR/USD bears may have more to chew on in Europe. Isabel Schnabel of the European Central Bank warned that delaying EU fiscal aid would be a ‘catastrophe.’ She shed light on issues with distributing the already agreed New Generation funds.”
“The old continent's more significant issues come from covid. Cases remain elevated in Germany, France, and Italy, with Spain joining in with fresh post-Easter increases. Moreover, several EU countries have banned the usage of AstraZeneca's vaccines for most adults, potentially delaying immunization rollout.”
“Some support awaits at 1.1890, the daily low, followed by 1.1860, which cushioned the pair on Thursday. Resistance is at the April peak of 1.1925, followed by 1.1950 and 1.1990, the latter being a double top.”
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.
Latest Forex News
Editors’ Picks
EUR/USD holds gains above 1.2050 amid dollar weakness
EUR/USD is trading above 1.2050, holding onto its substantial gains. The dollar remains on the back foot despite an uptick in US bond yields. European regulators are set to rule on J&J's vaccine and US infrastructure news is awaited.
GBP/USD retreats from 1.40 amid upbeat UK jobs figures
GBP/USD is trading below 1.40, off its highs as the dollar edges higher. Earlier, the UK reported a drop in the unemployment rate to 4.9%, better than expected. The Claimant Count Change also beat estimates with 10.1K.
XAU/USD tests key Fibo resistance at $1,775
XAU/USD rebounds after closing in the negative territory on Monday. 10-year US Treasury bond yield is edging lower on Tuesday. Additional gains are likely if gold manages to clear $1,775 resistance.
Ethereum price on cusp of massive breakout if key level holds
Ethereum price had a significant 23% correction in the past week but holds above a key support level on the 12-hour chart. The digital asset still has robust on-chain metrics supporting it and aims for a rebound.
S&P 500 (SPX) Update: Equity markets take a well deserved breather, crypto stocks slide
Equity markets took a much-needed break from setting record highs on Monday. Tesla suffered a steep 5% fall after reports of a crash with no one at the wheel. Have a Coke and a smile was up 1% as KO smashed earnings estimates.