We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Bullish
More View more
Real Time News
  • The Singapore Dollar is driven by the Monetary Authority of Singapore, which manages exchange rate instead of short-term interest rates. Learn more on the $SGD and how to trade it. Get your update from @ddubrovskyFX here: https://t.co/eWLM9XZs5Y https://t.co/OWuwGML4Ch
  • RT @FT: Huawei admits that US sanctions are hurting https://t.co/GIT4XSfszx
  • RT @WSJecon: Mexico’s inflation eased in September, coming in line with the Bank of Mexico’s 3% target for the first time in three years ht…
  • My phone's decided to give up the ghost and I've been phoneless for 24 hours. Not coincidentally, I've been a machine tackling errands around the house. What a time to be alive.
  • #Gold remains stuck in a range as a range of conflicting forces battle and fail to take control of price action. Get your $gld market update from @nickcawley1 here: https://t.co/pw7UjkUyqH $XAUUSD https://t.co/YD8L6knjhe
  • Geopolitical developments send oil prices soaring or falling. Get your market update here: https://t.co/0znHZPvPON https://t.co/s358dvMBeR
  • Currency markets may be battered by breakneck volatility if a slowdown in global economic growth triggers a collapse in the fragile market for collateralized loan obligations (CLOs). Get your market update from @ZabelinDimitri here:https://t.co/KfjjtaXs7b https://t.co/sWeSlv33pb
  • The #Dow Jones and #Nasdaq 100 will await key earnings from some of the world’s largest manufacturers and tech companies while the #DAX grapples with freshly-imposed tariffs. Get your equities market update from @PeterHanksFX Here: https://t.co/u2lG19JFt3 https://t.co/OHs4rQEH7T
  • Crude #oil prices are consolidating above a key support zone we’ve been tracking for more-than three months now. Get your market update from @MBForex here: https://t.co/XaACvEpLG4 #OOTT https://t.co/XjmjUt4Par
  • Why trade with Bollinger Bands®? Find out as a day trader, how you can use it to your advantage:https://t.co/dwODDDSsFi @WVenketas https://t.co/SYduJ5k9mL
Euro Chart Resistance Next Post ECB? Yen Eyes Trump Mexico Tariff

Euro Chart Resistance Next Post ECB? Yen Eyes Trump Mexico Tariff

2019-06-06 23:00:00
Daniel Dubrovsky, Analyst
Share:

Asia Pacific Market Open Talking Points

  • Euro finds support on a less-dovish ECB as the US Dollar takes a hit
  • EUR/USD still facing a medium-term descending range of resistance
  • Asia markets may sour as US said to raise tariffs on Mexico Monday

Trade all the major global economic data live as it populates in the economic calendar and follow the live coverage for key events listed in the DailyFX Webinars. We’d love to have you along.

Euro Rallies on Less-Dovish ECB

The Euro outperformed against its major counterparts on Thursday, owing to a less-dovish-than-expected ECB monetary policy announcement. Anticipation of a rate cut by the end of this year dropped from about a 47% probability yesterday to 37% as German front-end government bond yields rallied. As a side-effect, the US Dollar took a hit and depreciated against its peers given that Fed rate cut bets are on the rise.

President Mario Draghi envisioned holding rates through at least the first half of 2020, compared to the end of 2019 prior. But, near-term growth and inflation expectations were revised higher. This year, they are looking at regional economic expansion of 1.2% from 1.1% with CPI at 1.3% from 1.2%. While the central bank remains confident in their baseline assessment of the economy, risks are still tilted to the downside.

Euro Technical Analysis

EUR/USD closed above near-term horizontal resistance at 1.1262 after days of struggle, rising as anticipated. But, my medium-term outlook is still biased to the downside. From here, the currency pair is eyeing a descending range of resistance going back to the beginning of this year. Just above it is also a critical psychological barrier between 1.1302 and 1.1324. If these are cleared, it exposes reversing the dominant downtrend.

EUR/USD Daily Chart

Euro Chart Resistance Next Post ECB? Yen Eyes Trump Mexico Tariff

Chart Created in TradingView

The ECB was felt not just regionally, but externally as well. S&P 500 futures fell alongside the DAX and Euro Stoxx 50. However, sentiment recovered, especially after reports crossed the wires that the US was weighing delaying Mexican tariffs after attempts to reach a deal fell apart yesterday. But, that optimism appears short-lived after US Vice President Mike Pence hinted that the levies will take effect on Monday.

Friday’s Asia Pacific Trading Session

As such, we aren’t in the clear yet for a confidence-inspiring recovery in risk trends. US President Donald Trump still has to make his decision on additional Chinese tariffs that will encompass virtually all imports. He has said that the choice will come as we get to the G20 Summit occurring in Osaka, Japan, at the end of this month. I believe that in the medium-term, the US Dollar is poised to benefit if aggressive risk aversion ensues.

In the meantime, S&P 500 futures are now pointing lower after the US-Mexico trade talk developments. Even though we saw a rally on Wall Street, Asia Pacific equities may struggle to find much upside follow-through as they did yesterday. In Australia, shares of BHP Group, a major mining company, look like they are hinting of a top to potentially come in the ASX 200 as trade war fears risk heating up. The anti-risk Japanese Yen may rise.

FX Trading Resources

--- Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.