As a result of modest price pressure around the dollar, the EUR/USD attempts to regain its footing and return to the positive area. The recent drop in the US Dollar Index (DXY) is being sustained by the collaborative and interactive attitude in the US bond market, which, combined with some profit-taking reaction involving the greenback, is giving legs to the rebound in spot gold prices and silver prices.
The prospects for the single currency is still clouded, despite the ongoing strengthening of the pair, as a result of renewed optimism about the economic expansion (as evidenced by recent findings in some underlying principles) and rising wagers on the Federal Reserve’s QE trimming at some point later this year. It remains to be seen if the recent relatively strong Retail Sales would inspire any shocking adjustments in the Fed’s stance at its meeting next week, which will take place on Wednesday. Later on in the Euro calendar, the findings of the July Current Account in the Eurozone as a whole are due, preceded by the official inflation statistics for August in the single currency area.
Alert on EUR
With purchasing demand from the dollar increasing, the EUR/USD caved and fell to multi-week low points in the mid-1.1700s on Thursday. With the European Central Bank’s dovish “recalibration” now in the rear-view mirror, buyers appear to have returned their interest to inflation concerns and the growth of the Delta variant, which, when combined with presumptions about the Federal Reserve’s trim, are expected to keep the spot market under surveillance for the foreseeable future.
The following are the most pressing topics on the back burner: In the region, there has been an uneven economic recovery. The long-term viability of the increase in inflation statistics, immunization program performance and the Delta variant of the COVID 19 virus are being closely monitored. Political stirring surrounding the EU Recovery Fund is a distinct possibility. The upcoming German polls in September might cause some political worries in the environment. Because of the epidemic, traders may be shifting their portfolios to European assets, which may provide more support for the Euro and ease speculations on the European Central Bank tapering.
EUR/USD Pivot Points to Monitor
EUR/USD CHART. Source: Tradingview.com
So far, the spot has gained 0.09% at 1.1775 and has the monthly high of 1.1926 in front of it as well as the immediate resistance of 1.1845 (which is the weekly high) (100-day SMA). On the other side, if the price falls below 1.1750 (September 16th low), this would target 1.1704 (March 31st low) en way to 1.1663. (2021 low Aug.20).
