The EUR/USD currency pair kicked off Friday’s trading session on weak bullish momentum following the Federal Reserve’s announcement of a $2.3 trillion plan that is aimed at facilitating economic support in the U.S.
The EUR/USD currency pair’s performance on Friday seemed to be muted as the price failed to show significant momentum. The weak bullish performance saw the price break through the 1.0937 resistance level as it traded higher and it even managed to break through the 1.0951 resistance level briefly before the bulls lost their momentum.
The price of the currency pair has for the most part been trading at around the 1.0937 resistance level. It has also been trading significantly higher than the closest support level at 1.0881. This is in support of the bullish performance despite the weak bullish performance.
Analysts may have expected the EUR/USD to have strong bullish momentum on Friday on account of the Fed’s recently announced lending plan in which the U.S economy will receive a sizable $2.3 trillion boost. However, the currency pair has not performed as expected and for good reason. The economic outlook is quite underwhelming considering that the unemployment rate has so far soared beyond expectations.
Many people in the U.S have so far lost their jobs because many industries have been forced to shut down their operations due to the coronavirus threat. Demand in most industries has been extremely low as self-isolation and lockdown measures prevail in a bid to subdue the viral outbreak. Unfortunately, the infection rate seems to be soaring despite the measures and health experts are concerned that the situation may continue to worsen.
Analysts are also concerned that the prolonged viral threat may also cause more damage to the economy. Investors are currently choosing to remain cautious because the market is still not out of the woods. This explains the weak bullish attempts in the EUR/USD’s performance, as well as the fact that investors are holding off ahead of the upcoming inflation data.