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
Mixed
Oil - US Crude
Bearish
Wall Street
Bullish
Gold
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
Bearish
More View more
Breaking news

Chinese PMI Data Beats Estimates. Manufacturing 52.0, Est 44.8, Non-Manufacturing: 52.3, Est 42.0

Real Time News
  • #CrudeOil prices rise over 7% in Asia trade in the aftermath of rosy March China PMI data - https://t.co/3hvZXv4xij
  • My trading video for today: '#Dow and S&P 500 Slow Advance a Best Outcome, G7 and Chinese PMI Ahead' https://www.dailyfx.com/forex/video/daily_news_report/2020/03/31/Dow-and-SP-500-Slow-Advance-a-Best-Outcome-G7-and-Chinese-PMI-Ahead.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/JFyPe0UWjq
  • Foreign exchange – or “#forex” – markets often pay close attention to politics and central bank policy. We offer a model for traders to gauge their impact on exchange rates. Get your market insight from @ZabelinDimitri and @CVecchioFX here: https://t.co/FbXc1Awu6a https://t.co/IZlYdXrnLm
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 6.93% Silver: 0.73% Gold: -0.41% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/wMbZni4GxM
  • "However, this downgrade may be the canary in the coalmine for other emerging market economies that may spread to their OECD counterparts" https://www.dailyfx.com/forex/fundamental/article/special_report/2020/03/30/Euro-May-Rise-on-ESM-Crude-Oil-Selloff-Deepens-on-OPEC-Price-War.html
  • You can't see it, but I have a seriously dubious look on my face https://t.co/vOEfdaHwyg
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.18% 🇦🇺AUD: -0.13% 🇨🇦CAD: -0.22% 🇪🇺EUR: -0.27% 🇬🇧GBP: -0.69% 🇯🇵JPY: -0.70% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/XyAyUgqavm
  • LIVE NOW! APAC Head Strategist @IlyaSpivak discusses the technical and fundamental $AUDUSD outlook for the week ahead here - https://www.dailyfx.com/webinars/378612179?CHID=9&QPID=917720&utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.82%, while traders in US 500 are at opposite extremes with 72.90%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/el9cpkaZNX
  • The $USD may rise versus the Singapore Dollar, Indonesian Rupiah and Malaysian Ringgit if capital flows out of #ASEAN countries as key U.S. data risks a selloff in equities. Get your market update from @ddubrovskyFX here: https://t.co/JWIRn6MLrK https://t.co/W3zdKcvSCJ
EUR/USD Rate Carves Higher Highs and Lows as Bearish Momentum Abates

EUR/USD Rate Carves Higher Highs and Lows as Bearish Momentum Abates

2020-03-26 05:00:00
David Song, Strategist
Share:

EUR/USD Rate Talking Points

EUR/USD extends the rebound from the yearly low (1.0636) as European officials show a greater willingness to support the monetary union, and the exchange rate may stage a larger recovery as the bearish momentum abates, with the Relative Strength Index (RSI) reversing course ahead of oversold territory.

EUR/USD Rate Carves Higher Highs and Lows as Bearish Momentum Abates

EUR/USD carves a series of higher highs and lows as recent remarks from European Central Bank (ECB) suggest the Governing Council will take additional steps to combat the weakening outlook for growth, with President Christine Lagarde pledging to “do everything necessary within our mandate to help the euro area through this crisis.”

At the same time, ECB board member Isabel Schnabel insists that the central bank will “take further measures if needed” even though the Governing Council establishes the Pandemic Emergency Purchase Programme (PEPP), with the official going onto say that “there are proposals to use the European Stability Mechanism or the European Investment Bank” amid the growing number of COVID-19 cases across the monetary union.

The comments suggest the ECB will continue to deploy unconventional tools as President Lagarde plans to “explore all options and all contingencies to support the economy through this shock,” but it remains to be seen if the non-standard measures will have the intended impact as the Governing Council pushes monetary policy into uncharted territory.

With that said, the rebound in EUR/USD may prove to be short lived as the US Dollar benefits from the flight to safety, but recent price action raises the scope for a larger correction in the exchange rate as it carves series of higher highs and lows, while the Relative Strength Index (RSI) reverses course ahead of oversold territory.

Forex for Beginners
Forex for Beginners
Recommended by David Song
Forex for Beginners
Get My Guide

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss key themes and potential trade setups surrounding foreign exchange markets.

EUR/USD Rate Daily Chart

Image of EUR/USD rate daily chart

Source: Trading View

  • Keep in mind, the monthly opening range has been a key dynamic for EUR/USD in the fourth quarter of 2019 as the exchange rate carved a major low on October 1, with the high for November occurring during the first full week of the month, while the low for December happened on the first day of the month.
  • The opening range for 2020 showed a similar scenario as EUR/USD marked the high of the month on January 2, with the exchange rate carving the February high during the first trading day of the month.
  • However, the opening range for March has become less relevant amid the pickup in volatility, with the pullback from the yearly high (1.1495) producing a break of the February low (1.0778) as the exchange rate slips to a fresh 2020 low (1.0636).
  • Nevertheless, EUR/USD carves a series of higher highs and lows following the failed attempted to test the Fibonacci overlap around 1.0560 (100% expansion) to 1.0600 (161.8% expansion), with the Relative Strength Index (RSI) highlighting a similar dynamic as the oscillator reverses course ahead of oversold territory.
  • In turn, the close above the 1.0830 (78.6% expansion) to 1.0860 (23.6% retracement) region brings the overlap around 1.0950 (100% expansion) to 1.0980 (78.6% retracement) on the radar, with the next area of interest coming in around 1.1040 (61.8% expansion).
Traits of Successful Traders
Traits of Successful Traders
Recommended by David Song
Traits of Successful Traders
Get My Guide

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

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

DISCLOSURES

News & Analysis at your fingertips.