- EUR/USD fades the earlier uptick to 1.1060.
- Further downside exposes YTD lows near 1.1030.
- German, EMU flash PMIs surprised to the upside.
The bearish note around the shared currency remains well and sound at the end of the week and is now taking EUR/USD to the 1.1040 region.
EUR/USD stays close to YTD lows
The pair keeps navigating the vicinity of 2020 lows around 1.1030 on Friday, quickly fading the earlier spike to daily highs around 1.1060 after advanced manufacturing PMI in Germany and the broader euro bloc are expected to come in above estimates for the month of January.
EUR dropped further on Thursday in spite of the ECB left the monetary policy conditions unchanged and announced the start of the strategic review, which is expected to be focused on inflation, employment and climate change among the main topics.
In the meantime, investors continue to closely follow the developments from the Chinese coronavirus and its potential impact on the global growth. In this regard, the WHO has recently decided not to call the outbreak an international alarm, although the decision could be revisited later today.
Absent further publications/events in Euroland, the focus of attention will now shift to the US economy, where Markit will publish its manufacturing and services gauges later in the NA session.
What to look for around EUR
The pair remains under pressure near yearly lows in the 1.1050 region, always looking to USD-dynamics as the almost exclusive driver for the price action. In the meantime, headlines from the coronavirus outbreak in China keep driving the sentiment in the very near-term. On the broader picture, markets’ attention has now shifted to a more data-dependent stance, while the US-China trade front remains muted. On the more macro view, auspicious prints from flash PMIs in the core euro area were unable to change the mood around the euro, which remains on the offered side on the back of the renewed ‘wait-and-see’ stance from the central bank.
EUR/USD levels to watch
At the moment, the pair is retreating 0.10% at 1.1040 and a breakdown of 1.1036 (weekly/2020 low Jan.23) would target 1.0989 (low Nov.14 2019) en route to 1.0981 (monthly low Nov.29 2019). On the flip side, the next hurdle aligns at 1.1068 (100-day SMA) followed by 1.1131 (200-day SMA) and finally 1.1172 (weekly high Jan.16).
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 falls back toward 1.1150 as US Dollar rebounds
EUR/USD is falling back toward 1.1150 in European trading on Friday, reversing early gains. Risk sentiment sours and lifts the haven demand for the US Dollar, fuelling a pullback in the pair. The focus now remains on the Fedspeak for fresh directives.
GBP/USD struggles near 1.3300 amid renewed US Dollar demand
GBP/USD is paring back gains to trade near 1.3300 in the European session. The data from the UK showed that Retail Sales rose at a stronger pace than expected in August, briefly supporting Pound Sterling but the US Dollar comeback checks the pair's upside. Fedspeak eyed.
Gold hits new highs on expectations of global cuts to interest rates
Gold (XAU/USD) breaks to a new record high near $2,610 on Friday on heightened expectations that global central banks will follow the Federal Reserve (Fed) in easing policy and slashing interest rates.
Pepe price forecast: Eyes for 30% rally
Pepe’s price broke and closed above the descending trendline on Thursday, eyeing for a rally. On-chain data hints at a bullish move as PEPE’s dormant wallets are active, and the long-to-short ratio is above one.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.