Euro Remains Vulnerable
By Dmitriy Gurkovskiy, Chief Analyst at RoboMarkets
EUR/USD, the major currency pair, remains weak in the middle of February, although there were some moments when it tried to recover. These attempts weren’t too successful, however, as they showed that market players were still interested in the Euro.
The Euro is trying to recover against the USD, but only when there are speculations on the market. For instance, it happened last Thursday, when investors needed “safe haven” assets due to concerns about trade talks between the U.S. and China. In this light, the USD retreated and the Euro managed to benefit from the situation. However, these moments don’t last long.
Despite these short-term improvements, the Euro is unable to fight negative external conditions. Last week, the European Commission revised downwards its outlook on the Eurozone economy for 2019; according to latest estimates, GDP may add only 1.3%, down from a previous estimate of +1.9%. The EC says the key negative factors are weak demand from China and growing political uncertainty.
At the end of last week, the European currency reached the lowest levels in two weeks. Right now, it is still very vulnerable. This morning, the Euro is trying to recover again, but not very actively.
Over the last several weeks, bears have dominated EUR/USD. Right now, the pair is getting closer to the low at 1.1289. After breaking it, the price may test the support line of the current channel at 1.1270 and then start a new correction to reach and break the resistance at 1.1330. The possible upside correctional targets maybe at 1.1363 and 1.1392 (38.2% and 50.0% Fibo respectively).
Any predictions contained herein are based on the authors’ particular opinion. This analysis shall not be treated as trading advice. RoboMarkets shall not be held liable for the results of the trades arising from relying upon trading recommendations and reviews contained herein.