EUR threatens support range as USD bull-run regains control

0
137

USD, EUR, and JPY trending points

  • USD bull run had made a strong comeback on Monday (the 4thof March) after Thursday’s GDP report
  • Last week’s fresh lows had turned into a weekly high on Monday morning US trading session, and retested 96.68 level
  • JPY weakness became pronounced alongside EUR and GBP

American dollar regains control on better-than-expected US GDP growth, EUR GBP & JPY nudged lower

Followed by the reveal of last week’s US GDP data that nearly crossed Trump Administration’s target of 3.0 percent growth in 2018, despite a rancorous trade conflict between United States and China, the market had absorbed the data and bear fruits for American Dollar on Monday’s intra-day trading, as during the preparation of the report, the DXY index had been trading 0.22 percent higher at 96.43 after re-testing a weekly high of 96.68 at the morning trading session. Besides, the American Dollar USD had been residing at 96.22 against a gauge of six major currencies on average, with a daily low at 95.81, posted during the early Asian trading session.

DXY daily price chart

DXY daily price chart

- Advertisement -

Across the forex streets, a JPY softening got worsened against a basket of major currencies including American dollar and Great Britain Pound, as USD retested a 112.00 level in the morning trading session, while Japan’s Nikkei 225 had surged to a three-weekly high.

USD/JPY daily price chart

USD/JPY daily price chart

As the market opens in the early morning, the Euro and GBP both had shown promise, abruptly reaching $1.1392 and $1.3280 at the early Asian trading session respectively, however, since the beginning of European trading sessions, the Euro and GBP both had failed mercilessly against American dollar, currently residing at $1.1322 and $1.3180, losing 0.35 and 0.20 percent respectively.

GBP/USD daily price chart

GBP/USD daily price chart

EUR/USD daily price chart

EUR/USD daily price chart

However, ECB is expected to inject new economic stimulus alongside Bang of England to grapple with an inevitable slowdown, which would likely proffer an upbeat momentum for both of the currencies.

Bottom Line

As a busy forex week has been ahead of the traders, high volatility is expected and present weakness of Euro and GBP would unlikely to sustain. Followed by ECB’s policy meeting and Eurozone outlook, the Euro would likely to move higher, as eurozone unemployment remains at a 10-year low and fresh economic stimulus mostly in forms of long-term low-tax debts would likely push the Euro forward above 1.14 level in a near term outlook.

The GBP would likely to be nudged higher closer to its initial resistance level at 1.3286 after announcement of financial stimulus from Bank of England ahead of a recession risk becoming more and more imminent.

The American dollar is likely to fall over this busy forex week, as US President Donald Trump had again criticized the Fed over its monetary policy in a tweet yesterday, presumably seeking a less tightened monetary policy.

On the flipside, in a near-term outlook, EUR/USD pair would likely to find a critical support level between 1.1210-1.1300, while the British Currency may find its initial support at 1.3150, as numbers of no-deal Brexiteers lawmakers had been deducing substantially.

Read more on USD here

[Disclaimer: The content of this article is personal opinion and should not be considered as investment advice or suggestion towards any trading activity.]

LEAVE A REPLY

Please enter your comment!
Please enter your name here