EURUSD Forecast: Dollar regains its poise ahead of Wall Street’s opening
EUR/USD Current Price: 1.1163
Central banks’ stimulus programs can’t calm down speculative interest. US March data began reflecting the economic disruption of the coronavirus crisis. EUR/USD retreats from 1.1236 as risk-off dominates the scene.
The EUR/USD pair surged at the weekly opening, rallying up to 1.1236, holding on to gains, despite a dismal market’s mood. The US Federal Reserve surprised markets by announcing Sunday a massive $700 billion worth of bond-buying program and mortgage-based securities buying while slashing rates to 0.0%. The Fed was not alone. The RBNZ also cut rates at the beginning of the week, while the BOJ announced a series of monetary measures, all of them meant to cope with the coronavirus crisis.
The dollar eased, and Wall Street’s futures collapsed, reaching their daily 5.0% limit. Yields trimmed Friday gains as speculative interest rushed back to safety. The greenback got some market’s favour, although against its European rival, remained in the red. It’s going to be a tough day for Wall Street.
The EU didn’t release relevant data, while the US March NY Empire State Manufacturing Index plummeted to -21.5 in March, far worse than the 4 expected and the previous 12.9. Attention is on the EU Finance Minister Meeting, and the G7 call on coronavirus, to take place throughout the day.
EUR/USD short-term technical outlook
The EUR/USD pair is currently trading in the 1.1160 price zone, after meeting sellers around the 38.2% retracement of its latest daily run. Last week, the pair bottomed at the 61.8% retracement of the same rally. The 4-hour chart shows that the pair is developing below a bearish 20 SMA, but so far holding above a bullish 100 SMA, although technical indicators turned south within negative levels. The risk will turn bearish on a break below 1.1145, the immediate support level, exposing then the 1.1050 price zone.
Support levels: 1.1145 1.1110 1.1050
Resistance levels: 1.1200 1.1235 1.1270
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