- EUR / USD rises modestly on the day but has failed to regain the 1.1800 level.
- While data from the EU and the US were largely ignored, the increased risk in market tone appears to have weighed on the USD.
The EUR/USDAlthough it is trading modestly on the day, it is still struggling to break above the 1.1800 level and, in recent trading, has fallen back to 1.1780. With the weekend fast approaching and currency volumes dropping, a breakout above this resistance level appears unlikely in the near future, as does the prospect of the EUR / USD falling back below the highs. lows this week at 1.1760. The trade is likely to gain some direction again early next week as the currency markets grapple with month-end and quarter-end rebalancing flows.
Performance of the day
Like strong PMI data earlier in the week, the stronger-than-expected German IFO survey on Friday morning failed to inject much recovery momentum into the euro on Friday. Similarly, data for core inflation measured by the US PCE and personal income and spending data for the month of February did not reveal anything too surprising (inflation was still soft, but still expected to rebound in the coming months, while revenue and spending fell from January’s stimulus control disappeared and amid bad weather) and as a result, the EUR / USD did not move at all.
EUR / USD’s modest rally appears to be due more to USD’s bullish momentum taking a little breather; The USD had been pushing towards new yearly highs for the past few days (just like the EUR / USD has been making new yearly lows), but the Dollar Index (DXY) has run into some profit-taking activity by before 93.00.
Elsewhere, some market commentators are already citing month-end flows as a factor weighing on the dollar. More likely is the fact that Thursday’s relative risk of bias (with gains seen in global equity, commodity and risk-sensitive currencies markets) is weighing on demand for safe-haven currencies, hence the which is why the safe-haven JPY is performing so poorly in the market. day (the yen is down almost 0.5% against the dollar, and its losses against the euro are close to 0.7%).
Technical levels
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