15 May 2019
The bid tone stays unchanged around the shared currency so far today, with EUR/USD managing well to keep the trade above 1.1200 the figure for the time being.
EUR/USD cautious on trade, US data
The pair is posting some decent gains following two consecutive daily pullbacks, managing to come back after piercing 1.1200 the figure during early trade.
EUR is deriving some mild support from alleviated tensions on the US-China trade front today, although the cautious stance prevails among market participants for the time being.
In the meantime, the single currency stays under pressure in light of today’s disappointing figures from advanced GDP figures in both Germany and the broader euro area, adding to Tuesday’s poor readings from Economic Sentiment in those same regions.
Later in the NA session, Retail Sales and the Empire State index will be the salient events seconded by Industrial Production and Capacity Utilization figures, the NAHB index and TIC flows.
What to look for around EUR
Recent data releases in Euroland and Germany have poured cold water over the idea that some healing process could be under way in the region, re-shifting the focus to the ongoing slowdown and its likely duration and extension. In the meantime, the current ‘neutral/dovish’ stance from the ECB is expected to persist for the reminder of the year and probable H1 2020. The broad-based risk-appetite trends and USD-dynamics are posed to rule the sentiment surrounding the European currency for the time being, all in combination with the onoging US-China trade dispute and potential US tariffs on EU products. On the political front, headwinds are expected to emerge in light of the upcoming EU parliamentary elections in late May, as the populist option in the form of the far-right and the far-left movements appears to keep swelling among voting countries.
EUR/USD levels to watch
At the moment, the pair is gaining 0.04% at 1.1207 and a break above 1.1264 (high May 1) would target 1.1313 (100-day SMA) en route to 1.1323 (high Apr.17). On the downside, immediate support aligns at 1.1176 (monthly low Mar.7) seconded by 1.1135 (low May 3) and finally 1.1109 (2019 low Apr.26).
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