Today we shall take a look at the EUR/USD currency pair. Last Monday marked the beginning of a new powerful downward wave, which pushed the exchange rate of this pair below 1.10.
The European single currency is sinking under the pressure of unfavorable results from fundamental reports released in the past few days. Data coming from Germany, the European Union’s powerhouse, and reports on the eurozone as a whole both disappointed investors last week, indicating just how stagnant the economy is right now. This week we expect an influx of even more important reports, such as GDP estimates (Friday) and CPI data from Germany (Thursday). It is possible that these would also fail to meet the forecasted levels, in which case the euro will continue to slip further down.
The situation with the American dollar is the exact opposite to the euro’s right now. The most recent fundamentals coming out of the United States were overwhelmingly positive, showing that the US economy is strong and healthy, despite the protracted trade conflict with China. Moreover, the USD is currently winning over positions because of its status as a safe haven for investors. The coronavirus epidemic in China is still rattling the markets and driving risk appetite down, which has forced traders to turn to the dollar, boosting its value with their high demand. This trend will likely continue over the next few days, making this week ideal for EUR/USD bears.
In terms of the daily chart, today we have a pivot point for the pair located at 1.0948, with the price currently trading just a pip below it. The daily support levels lie at 1.0945 and 1.0939. The daily resistances are located at 1.0954 and 1.0957. The indicators of technical analysis strongly and unanimously recommend a sell position today.
