- EUR/USD fades Monday’s drop and retakes 1.0950.
- Impact of COVID-19 on world economy remains in centre stage.
- Import/Export Prices, NFIB index, Fedspeak next on the US docket.
The single currency has resumed the upside on Tuesday and is now lifting EUR/USD back to the 1.0940/50 region, where some decent resistance has turned up.
EUR/USD keeps targeting the 1.0990 region
EUR/USD has reversed the pessimism seen at the beginning of the week and manages well to rebound from the boundaries of the 1.09 neighbourhood to the 1.0940/50 band during the European morning.
In the meantime, the broader scenario in the global markets continues to look to the developments from the coronavirus for direction against the backdrop of the persistent lockdown in Europe and the US. Some countries, however, unveiled plans to start reactivating the dormant economy in the next couple of weeks, lending some support to the currency.
Later in the session, there are no scheduled releases in Euroland, whereas Import/Export Prices, the NFIB index and speeches by FOMC’s Bullard, Evans and Bostic are all due across the pond.
What to look for around EUR
The euro is alternating gains with losses in the first half of the week, always with the COVID-19 in the focus of attention. On the more macro view, the single currency is expected to come under pressure in the next periods in light of the forecasted contraction in the economy of the region in the first half of the year, relegating hopes of a strong recovery to Q3 and/or Q4. On the positive side, the recent Eurogroup agreement helped to alleviate some political effervescence among some state members, keeping retracements in the currency as shallow for the time being.
EUR/USD levels to watch
At the moment, the pair is gaining 0.26% at 1.0934 and a break above 1.0967 (weekly high Apr.13) would target 1.0971 (55-day SMA) en route to 1.0992 (monthly low Jan.29). On the other hand, immediate contention emerges at 1.0906 (weekly low Apr.13) followed by 1.0814 (78.6% Fibo of the 2017-2018 rally) and finally 1.0768 (monthly low Apr.6).
Share
