The euro has staged a strong bound against the US dollar, following weak US economic data releases and the recent announcement of fresh trade tariffs.
2 August 2019 | SQUARED DIRECT – The drop towards 1.10 was interrupted yesterday as traders booked profits on the US Dollar on fear of possible additional rate cuts by the Fed, after a weaker-than-expected ISM Manufacturing PMI data. Additionally, Trump announced a new round of tariffs on China which accelerated a US Dollar sell-off across the board, helping the Euro gain some ground.
A combination of escalating trade tensions and a below-forecast US payrolls figure could strengthen the cases for additional rate cuts by the Fed in the near future, leading to broad-based losses in the greenback. However, the Single currency could drop below 1.10 if today’s NFP data blows past expectations.
EURUSD technical analysis
The Euro bulls were able to hold 1.1030 as support and pushed prices up just below the 1.11 resistance. The bias remains with the bears, as the sellers will have the psychological figure 1.10 at their sight, as long as the common currency is trading below 1.11 and the 50-day moving average. Any break above 1.11 or 1.1160 will be advantageous for the bulls to stop the recent bearish domination.
Support: 1.1035 / 1.10
Resistance: 1.11 / 1.1160
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