EUR/USD set for a course-correction after a bullish beginning to April

EUR/USD has kicked off the week on the back foot amid US inflation concerns. Furthermore, worries about the virus’ spread in Europe are weighing on the euro, Yohay Elam, an Analyst at FXStreet, reports.

EUR/USD pressured under 1.19

“At an inflection point – that is how Federal Reserve Chair Jerome Powell has described the economy, which is reopening rapidly and creating jobs amid America’s successful vaccination campaign – which provides the dollar advantage over the euro. Around 35% of Americans have received at least one shot, while the figure in Europe is below 20%.”  

“Tension is now mounting toward Tuesday’s Consumer Price Index statistics. Economists expect annual inflation to rise in the coming months and uncertainty about its sustainability is what is driving the dollar.”  

“Even if the old continent is making some headway against the virus and jabbing its population at a faster rate, vaccines may prove less effective than previously thought. A study in Israel has shown that Pfizer’s immunizations provide less protection against the South African variant of the virus. Such worries may boost the safe-haven dollar.”

“Support awaits at 1.1860, which cushioned it late last week. It is followed by 1.1820, which is where the 100 and 200 SMAs converge.”  

“Resistance is at the April high of 1.1925, followed by 1.1950 and 1.1990, lines that were last seen in March.”