- U.S Dollar Strengthens
- Risk Aversion Concerns
- Euro Resilience
EUR/USD pair failed to hold on to gains above the 1.13 level, conversely edging lower, as the U.S dollar strengthened against the majors Tuesday morning. The bid tone around the U.S dollar edged higher as a spike in coronavirus forced traders to rush for safety in safe-havens.
The upside momentum on the EUR/USD at the back of improving economic data in the Eurozone has come under pressure on a spike in risk aversion in the markets. The Dollar has continued to strengthen across the board on concerns over the potential impact of the second wave of coronavirus infections.
Time : 07-07-2020
Pivot : 1.1312
Technical View : Short Below 1.1292
Target : 1.1272 – 1.1242 – 1.1209
Comments : Weak Bearish
Last Price : 1.1260
A sour mood in the U.S stock market continues to put a bid tone around the U.S dollar, billed as a reliable safe-haven in times of crisis. Amid the pullback, on Tuesday morning, the EUR/USD pair is still trading near one-week highs as the Euro remains resilient against the greenback.
A plethora of positive economic data out of Germany and France has continued to offer support to the single currency against the greenback. Immediate data indicates that Industrial production in Germany rebounded with the easing of lockdown restrictions in May. Industrial output was up 7.8%.
Weakness in the U.S dollar has also continued to limit strong downside action on the EUR/USD pair. While the Dollar has remained resilient amid a spike in coronavirus infections, solid economic releases in the U.S have continued to affirm economic recovery, conversely averting risk aversion in the market.
An impressive job report that showed the U.S economy added 4.8 million jobs in June followed by impressive ISM Manufacturing data continue to affirm U.S economy resilience amid the pandemic. Likewise, there has been an uptick in demand for risky currency, a development that has sent the Dollar lower, resulting in the EUR/USD edging higher.
On Tuesday, the focus should be on Federal Reserve speakers likely to paint a picture on the U.S economy, likely to influence U.S dollar strength and EUR/USD price action.