- Sharp decline in equity markets boosts the dollar.
- The EUR / USD rally loses steam and the correction is ripe for more.
He EUR / USD is having the most significant drop of the month, losing more than 100 pips on Monday, before a rally of the dollar in the market before a crash of the stock markets in the world. The pair fell to 1.2129, the lowest level since December 11. It then bounced and is trading at 1.2160, in a context of high volatility.
The spread of the new strain of coronavirus across England led to flight cancellations to the UK and further restrictions, triggering widespread fears. This overshadowed the US deal for new $ 900 billion stimulus. The vote would be today and it is estimated that Trump would sign the law. Among the measures included are checks for $ 600 for families with incomes of up to $ 75,000 and the extension of unemployment benefit in the amount of $ 300 per week for 11 weeks.
In the middle of all this is Brexit. EUR / GBP rises sharply and trades above 0.92000, but this does not prevent the EUR / USD from falling sharply.. The beginning of the week limited by the Christmas holidays began with high volatility that could continue in the coming days.
EUR / USD is managing to break out of 1.2150, but if the downward pressures return below it would intensify and below 1.2130, the 1.2100 zone will be exposed. To the upside, a return above 1.2220 / 25 (4-hour 20 moving average) would ease downward pressures.
Technical levels
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