Today we would take a look at the EUR/USD currency pair. The pair has been shaky in July, but it currently appears to be on the rise.
The European single currency is neutral at the moment. There are no sources of shock from the EU, so there really isn’t much to drag the currency down, but there are also no incentives for growth, since the ECB is not going to raise interest rates in the next 12 months. There are no big announcements expected from the bloc this week, so right now instruments containing the euro will be influenced by the other currency in each pair.
Meanwhile, the American dollar is caught between two different incentives. On the one hand, strong fundamentals from the United States continue to support the currency. On the other hand, trade war worries are also beginning to weigh down the USD. Last week was dominated by Trump’s European tour, with a NATO summit and a meeting with British PM Theresa May, so not much was heard from the President on trade. After his visit to Russia this week, we are likely to learn more about the unfolding issue. Furthermore, today we expect a number of reports from the US, including retail sales and business inventories.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1683, with the pair currently trading above it. We expect the EUR/USD to be volatile today, so pay attention to the nearby resistances at 1.1689 and 1.1699, as the pair is quite close to them. In case today’s reports boost the dollar, be aware that the daily support levels are located at 1.1673 and 1.1667. The indicators of technical analysis show mixed signals, but lean towards a buy opportunity; the moving averages are neutral.
