EURUSD managed to rebound today recovering some of yesterday’s losses but stays below the 1.13 mark. Concerns yesterday about the rising number of coronavirus cases in the USA and Australia shift investors attention to safe-haven assets such as the U.S. Dollar and gold, which hit the highest level since 2011.
Better than expected economic data from Europe also met better figures from the U.S. Economy. The Services sector rebounded above the expectations in Europe. The European Monetary Union Services PMI came in at 48.3 above the forecasts of 47.3 in June, while the PMI Composite came in at 48.5 also above the expectations of 47.5. The Germany Services PMI reported at 47.3, topping the expectations of 45.8 in June. The Germany PMI Composite registered in at 47 above the estimates of 45.8. From France, the Markit Services PMI came in at 50.7 above analysts expectations of 50.3. The PMI Composite was at 51.7 also above the forecasts of 51.3 in June.
ECB has supported the common currency as the monetary measures boosted the recovery in Europe. Next week the ECB meeting is coming into investors radar. Analysts don’t expect any market-moving news. The Pandemic Emergency Purchase Program PEPP has allowed the ECB in buying peripheral bonds to ensure that its relief mechanism is working correctly. ECB’s package of asset purchases up to €1.35tn has improved investor sentiment, dragged borrowing costs lower and making investors more confident about holding the debt of weaker southern countries.
EURUSD Daily Technical Analysis
EURUSD is 0.25% higher at 1.1297 as the pair returns above the upper bound of the recent consolidation phase keeping the positive momentum alive. The technical picture is bullish as long as the pair stays above the daily major moving averages.
On the upside, the first resistance for EURUSD pair stands at 1.1309 the daily top. If the pair breaks the initial resistance, then the next hurdle is at 1.1332 the high from yesterday’s trading session. A move above 1.1332 might open the way for a test of the July 6 highs at 1.1345.
On the other side, initial support for the EURUSD stands at 1.1262 the daily low. Next support area would be met at 1.1201 the low from July 6. If the EURUSD pair breaks that support, then the next target for bears is at 1.1166 the low from June 22 trading session.
