Chart of the Day: EUR/USD

Chart of the Day: EURUSD (08/06/2020) |

Fairly quiet start to the week as the main catalyst/high impact news for the EURUSD could potentially be the ECB President Lagarde’s speech this afternoon at 15:45pm. Following last week’s announcement by the ECB to increase its bond purchases by €500 billion (€563 billion) in order to combat the effects of the coronavirus on the Euro zone economies bringing its total monetary stimulus to €1.35 trillion ($1.52 trillion), we saw the EURUSD rally to a high of 1.13836. However, better than expected Nonfarm payroll and unemployment figures from the U.S. could be weighing on the Euro as it closed on Friday at the lows at 1.12875. From a technical perspective, the EURUSD is currently trading around the 1.13 level. With a double bottom on the one hour timeframe around the 1.1275 level suggesting that a break above the swing high at 1.1394 could see the resumption of the current bullish trend. Across multiple time frames, price is holding above key moving averages suggesting that the momentum and bias is to the upside. However, on the weekly time frame, the trendline from the swing high on the 11.02.2018 and connected to the swing high on the 08.03.2020 and projected forward, shows a potential resistance around 1.1373. What is interesting to note is that the weekly 200 simple and 200 exponential moving averages are at 1.13335 and 1.13818 respectively. Hence, this could potentially limit our expectation of achieving our target of 1.1444 and in which case could signal the longer term bearish bias on the Euro.

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