Euro and American dollar trending points
- The euro has been down by 0.35 percent against USD on Tuesday, the 8thof January, 2019, as slowdown fears had been advancing, and an unexpected fall in the German output data added further strains
- The American dollar had been swinging up slowly, despite growing bets on US central bank’s pause on rate hike cycle
- As ECB is unlikely to hike rate until the 2020, the Euro outlook remained bearish and it appeared to be stuck in a tight region just above 1.1420
Euro falls on faltered German output data, USD slightly up
On Tuesday, the 8thof January, the Euro slid slightly, as the Eurozone economy had started to show the signs of economic slowdown. While the Euro had been tottered again in to its initial resistance zone at 1.1430, the US dollar kept gaining despite uncertainties over a pause on US central bank’s usual rate hike cycle.
Euro/USD daily price chart (alongside 50-day technical levels)
Multiple analysts had blamed the faltering of German output data for third straight months, behind the weakening of Euro. However, during the Asia pacific and European trading sessions, the plunge was modest, yet it banged the drum of a sluggish Euro-zone economy, which had been heard out loud in the currency market.
Many reports revealed that the German exporters had been struggling to grapple with a withering global demand as well as several geo-political economic issues, driven by US president Donald Trump.
According to several market strategists, the weak market data could awake the ECB’s monetary tightening plans for feathering earlier actions.
However, the European Central Bank (ECB) had said that they would be leaving the rates unchanged through the summer of 2019 and a tightened monetary policy might not experience a warmth of dawn before 2020.
While this report is being prepared, the 8thof January, 2019, GMT. 15.00, the euro had been plummeted over 0.35 percent, residing at 1.1433, while its initial support level still reigns over 1.1410, and a fall below, could retest its November 12thlow at 1.1220, as signs of economic slowdowns are now starting to fan the flames in European markets.
The weakness in the euro had initiated an upward glide in the American dollar, as the US dollar surged slightly from 95.16 to 95.43. The Euro weakness came as a blessing for the American dollar, as the American dollar index had lost over 3 percent over the past of couple of weeks amid worries of wobbling global economy and supply glut.
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[Disclaimer: The content of this article is personal opinion and should not be considered as investment advice or suggestion towards any trading activity.]