2020-05-19 • Updated
On Monday, the EUR/USD broke through the resistance of the MAs and established itself at a new local base above the support of 1.0905. The first week of May and the middle of April were the two last periods when this currency pair was at these heights. Extrapolating a symmetrical wavy shape of the chart, we may assume that the price will take another step to approach the resistance of 1.0988 and then will bounce back forming the tip of the third wave. Technically, that is possible. Practically, it will depend on the fundamental input because it was exactly a fundamental factor that led to the current uptrend in the first place.
Even if it hasn’t been plunging straightaway against the US dollar, the EUR has been depressive lately, both in the midterm and in the longterm – the 100-MA and 200-MA confirm that. Increased volatility may blur the picture, but this is what we have the MAs for. The fundamental reason for the weakness of the EUR is the one which became clear exactly in the course of the fight against the virus: the European Union does have obstacles in the way of its economic unity. However, the last announcement we received from the EU is countering that impression: the German Chancellor and the French President agree on a $546-bln aid package for the EU recovery. That is already a breakthrough, because it is not too often that we see that these two core European states agree on something. Therefore, in this proposal the spirit of the Union reveals itself in the clearest manner, supporting the EUR and launching it into a new upward trajectory. However, the gravity forces of the reality will not hesitate to check this intention for resilience: there are other 27 EU member states that need to agree on this proposal, and this will likely be a problem – waiting for the EUR/USD at 1.0988.
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The Australian Dollar (AUD) rebounds on Monday, despite a slight dip in the US Dollar (USD) and higher US Treasury yields. Investors are eyeing Australian monthly Consumer Price Index (CPI) data for February and US Gross Domestic Product (GDP) for Q4 2023. The AUD gains momentum as the ASX 200 Index rises, especially in mining and energy sectors. Additionally, the Aussie...
Gold prices rose on Monday as the US Dollar weakened amidst speculation about potential Federal Reserve rate cuts starting in June. This weakened Dollar was partly due to improved risk sentiment pushing US Treasury yields lower. Despite facing challenges from declining yields, gold prices recovered to nearly $2,170 per troy ounce, driven by the Dollar's weakness. Federal Reserve Chair...
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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