Today we shall take a look at the EUR/USD currency pair. Last week the euro put up a fight, winning back some of its lost positions against the weakened dollar.
The European single currency is surpassing everyone’s expectations at the moment. Based on the latest economic reports from the eurozone, the damage from the coronavirus pandemic is quite severe. Nearly all reports last week came in worse than expected, painting a grim picture of the European economy. Yet, the euro strengthened against all safe haven currencies, despite everything. Clearly, the single currency is a force to be reckoned with, a currency that won’t completely give in when faced with a crisis. We expect it to continue growing in value this week as well.
The US dollar right now is entirely dominated by investors’ attitude towards risk. Thanks to recent stimulus packages by the Federal Reserve, as well as ambitious bills from the US government, much of the earlier stress on the global markets was alleviated. This reduced the demand for safe haven assets and boosted risk appetite, despite the Covid-19 pandemic. If risk aversion does not return to the markets this week, we can expect the USD to soften further.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1129, with the price currently trading below it. The daily support levels lie at 1.1114 and 1.1091. The daily resistances are located at 1.1152 and 1.1167. The indicators of technical analysis are somewhat mixed in their predictions, but lean towards recommending a buy position today.
