US dollar gains after Fauci warns of US coronavirus cases

US dollar gains after Fauci warns of US coronavirus cases

The euro declined against the US dollar even after upbeat manufacturing data from Europe. The gain was probably because of the overall strong dollar, with the dollar index rising by 0.20%. According to Markit, manufacturing activity in the region rebounded in June as countries reopened their economies. In Germany, the manufacturing PMI rose to 45.2 from the previous 36.6 while in France, the PMI rose from the previous 40.6 to 52.3. Meanwhile, the PMI in the eurozone rose from the previous 39.4 to 47.4. At the same time, in Germany, the unemployment rate rose by a lesser margin than what most analysts were expecting. The rate rose from the previous 6.3% to 6.4%. 

The US dollar index rose today after Anthony Fauci warned that the number of coronavirus cases in the United States would continue to rise. In a statement, he said that the country was headed in the wrong direction as he predicted that cases could start jumping by 100,000 per day. The statement came even as more states started to hit the brakes on their reopening process. In total, health officials reported more than 44,000 new cases yesterday, the second highest since the start of the pandemic. Meanwhile, the currency is waiting for the official employment numbers from the United States. Analysts expect the economy to have created more than 3 million jobs and the unemployment rate to fall to 12%. According to ADP, private payrolls rose by more than 2.7 million in June.

The Australian dollar wavered today even after China and Australia reported upbeat manufacturing PMI numbers. According to Australia Industry Group, manufacturing PMI rose from the previous 41.6 to 51.5. Another report by Markit and Commonwealth Bank said that the PMI rose from the previous 44.0 to 51.2. Meanwhile, in China, a report by Caixin showed that the PMI rose from the previous 50.7 to 51.2. These numbers send a signal that business activity in the two countries is starting to improve. However, the biggest challenge is that coronavirus cases are rising. 

 

EUR/USD

The EUR/USD pair declined to an intraday low of 1.1187, which is the lowest level it has been since June 22. On the four-hour chart, the price managed to move below the ascending trendline shown in white for the second day in a row. The price is also slightly below the 50-day and 100-day exponential moving averages. Also, the signal and histogram of the MACD is at the lower side of the neutral line. Therefore, while the outlook for the pair is neutral, the pair is likely to continue falling as bears attempt to test the 1.1150 support level.

EURUSD

 

USD/JPY

The USD/JPY pair declined to an intraday low of 107.34. On the four-hour chart, the price is below the 50-day and 100-day EMAs. The pair is also forming a three black crows candlestick pattern, which is usually bearish. Additionally, it has moved below the 38.2% Fibonacci Retracement level. This means that the bears have gained some control, which means that the downward trend is likely to continue.

USDJPY

 

AUD/USD

The AUD/USD pair is trading at 0.6892, which is inside the triangle pattern it has been forming in the past few weeks. The price is consolidating along the 50-day and 100-day exponential moving averages while the main and signal lines of the Stochastic Oscillator have started moving lower. The price may remain inside the triangle ahead of the official US jobs data.

AUDUSD



Source: FxStreet

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