Search ForexCrunch
  • Sentix Investor Confidence  in July comes in below expectations.
  • US Dollar Index remains on track to close higher for the fourth straight day.
  • ECB’s Coeure says they could restart QE  if needed.

The EUR/USD pair lost more than 100 pips last week and started the day under  modest bearish pressure on Monday with the shared currency struggling to find demand. After testing the 1.12 handle earlier in the American session, the pair staged a rebound and was last seen trading at 1.1215, losing 0.08% on a daily basis.

Earlier in the day, the data published by the Sentix showed that the investor confidence continued to deteriorate in July with the Economic Index dropping to its lowest level since November 2014 at -5.8 from -3.3 in June and missing the market expectation of 0.1 to weigh on the shared currency.  

Sentix explained that investors were no longer following the positive signals of the global stock indexes. “There is no belief in a quick settlement in the trade dispute. Twitter reports alone will no longer lure investors around the world out of their reserves,” the press release read.

Moreover,  European Central Bank Governing Council member Benoit Coeure said  that the accommodative policy was needed more than ever and added that  the bank could restart the asset purchases if needed.

On the flip side, the greenback, which posted decisive gains against its major rivals on Friday following the upbeat labour market data from the U.S., preserved its strength on Monday and made it difficult for the pair to make a meaningful recovery. At the moment, the DXY is up 0.18% on the day at 97.35.

There won’t be any macroeconomic data releases from the euro area on Tuesday and markets will be waiting for speeches by the FOMC members Bostic and Quarles. Although Chairman Powell is also scheduled to speak tomorrow, his prepared remarks are unlikely to touch on the monetary policy outlook.

Technical levels to watch for