- EUR/USD up by over 0.20% to 1.0831
- Non-farm payroll to be announced
- Easing China-U.S trade tensions promote riskier currencies
The EUR/USD is off to a slow day on Friday with some sideways momentum after a slight bounceback from the day’s low. This means that the currency pair has eased off the bullish momentum that prevailed on Thursday as the Euro gained more ground over the U.S dollar, mainly on the heels of the trade tensions between China and the U.S.
The impact of the China-U.S trade relations on the EUR/USD
The previous reports about the U.S seeking to make China pay for the coronavirus have been eroded by newer reports about Chinese and U.S officials meeting to discuss the trade situation. The two parties reportedly talked about a trade deal in a teleconference. The reports about the discussion may have eased the dollar’s momentum against the Euro since the news encouraged investors to take on investments in riskier currencies. The EUR/USD has been trading above the 1.0727 level and below the 1.0862.
Time : 08/05/2020
Pivot : 1.0822
Technical View : Long above 1.0842
Target : 1.0862, 1.0894, 1.0917
Comment : Sideways
Technical view : Short below 1.0802
Target : 1.0782, 1.0727, 1.0694
A bullish run will have to encounter the 1.0862, 1.0894, and 1.0917 resistance levels. This will likely happen if the trade tensions continue to die down, thus giving investors more confidence in risker investments, thus away from the USD as the safe haven. On the flip side, if the dollar gains, then the currency pair will contend with the 1.0782, 1.0727, and 1.0694 resistance levels.
The U.S is scheduled to release its Non-Farm payroll data, and the outlook is bleak because the coronavirus has dragged down the economy. The upcoming data is expected to reveal a higher rate of joblessness, considering that more than 20 million people lost their jobs in April. This might weaken the dollar’s performance, thus giving the Euro a chance for more gains. In other words, the EUR/USD exchange rate might go up as the Euro gains over the U.S dollar.