Luigi Di Maio, the leader of the anti-establishment Five Star Movement, and Matteo Salvini, the head of the far-right League, were due to meet the Italian president on Monday to secure his approval for their alliance to govern Italy. How is this move impacting the EURUSD pair? Find out with this 21 May EURUSD Impact Analysis.
21 May, HotForex – EURUSD has settled higher after posting a trend low at 1.1716, which is the lowest level seen since mid December. The subsequently rebound stalled at 1.1745 amid talk of offers at and around the 1.1750 mark.
Italian Politics & USD Bid: 21 EURUSD Impact Analysis
Italy remains in the spotlight amid concerns about the policy proposals of the anti-establishment, Eurosceptic coalition government. ECB’s Nowotny said earlier, as Italian 10-year yields spiked a further over 5 bp to near two-year highs, that he hopes that the actual policies will be “much wiser” than the proposals.
The outlook appears bearish given the rising U.S. yield advantage relative to Bunds, coupled with the Italian situation. EURUSD has trend resistance at 1.1780 and the daily Pivot point before that it must breach the mid line Bollinger band at 1.1757. Support at 1.1740 has proved vulnerable today but further down 1.1720-10 support has been more substantial.
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