Today we would take a look at the EUR/USD currency pair. As of last week the pair continues steadily growing.
Not much has changed for the European single currency since our last analysis. Fundamental reports, while not altogether awful, remain off-target for the most part and inflation continues to be low. The European Central Bank recently unveiled a new stimulus plan which is naturally contributing to a further weakness in the euro. Nevertheless, in the absence of political shocks and a hope for a smoother-than-expected Brexit, right now there are no shock factors in the EU, so the price is holding steady.
Meanwhile, the tables have turned for the American dollar. Recent fundamentals showed that the economy of the United States is worsening. Unemployment is rising and the economic activity is not as strong as it was last year. This is very likely the consequence of Donald Trump’s prolonged trade conflicts with other countries (not only China), as well as his protectionist policies which are harming industrial activities. This week there will be a Federal Reserve policy meeting, where it is expected that interest rates will not be hiked due to the poor economic climate at present. Overall this situation has weakened the USD and we see a pronounced bearishness in it for the first time in a long while.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1324, with the price currently trading above it. The daily support levels lie at 1.1313 and 1.1307. The daily resistances are located at 1.1341 and 1.1348, and are currently both overcome. The indicators of technical analysis and the moving averages agree on a strong buy recommendation.
