Today we would take a look at the EUR/USD currency pair. After a serious drop last week, the euro began recovering and the rates are in the green once more.
The European single currency continues to lack incentives for growth. The European Central Bank will continue with their dovish monetary policy and investors expect to hear about a new stimulus plan for the eurozone very soon. There are also several political factors pressuring the EUR, such as Brexit and the global trade problems. However, as investors are already used to these factors, they no longer cause a huge commotion for the euro, which has managed to remain more or less neutral in the past weeks, except for when events affect the other currencies in pairs with the euro, which is the case right now. Tomorrow we expect the ZEW survey from Germany and the economic sentiment regarding the whole eurozone, which will both be important for the euro.
The American dollar, on the other hand, began the week by losing some of its previously won positions. This came as economic data from China was better than expected, allowing both the yuan and the euro to grow on the (most likely) temporary optimism on the markets. Nevertheless, as soon as trade risks spike again, we expect to see the USD strengthen once more.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1271, with the price currently trading above it. The daily support levels lie at 1.1266 and 1.1260, the first of which has been overcome already. The daily resistances are located at 1.1277 and 1.1282. The indicators of technical analysis currently remain neutral and we need to wait for more conclusive information.
