EURUSD Boosted by PMIs; Trade Tariffs Loom Large
EURUSD News and Talking Points
- Markit PMIs give the single-currency a lift ahead of EU trade tariff implementation.
- Washington is likely to respond further as trade wars escalate.
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EURUSD Continues Recent Rebound from Multi-Month Lows
The Euro continues to battle back from its recent lows, aided by a better-than-expected set of Markit PMIs that showed growth in the eurozone remains firm for now. The rally may prove short-lived however as the EU this weekend is set to implement its trade tariffs on around $ 3billion worth on US imports. While the details have already been announced in the past weeks, the fear is that US President Donald Trump may up the ante and increase tariffs on certain EU goods with the automobile industry likely to be in the firing line.
Ahead, Sunday’s EU 10 meeting will be looking at the ongoing immigration debate that is currently rattling Angela Merkel’s government before the important EU 28 summit on June 28-29 where the latest Brexit discussions will also be on the schedule.
EURUSD has seemingly made short-term support around the 1.1500 level but remains below all three moving averages. On the upside the Fibonacci retracement at 1.1710 is in view before further resistance between 1.1820 and 1.1840.
The latest IG Client Sentiment Indicator shows retail are 58.8% long EURUSD but recent positional changes give us a mixed trading bias.
EURUSD Daily Price Chart (January 2017 – June 22, 2018)
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--- Written by Nick Cawley, Analyst
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.