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| EUR/USD four-hour chart, source:FXDD.com |
cf. [EUR] Just Watching the Market 2020 0323
cf. [EUR] Euro in Complicated Crisis 2020 0316
One of the major currency pair, EUR/USD has risen for a week. There was a price-turning, double-bottoms pattern after a price-falling, Head-and-Shoulders pattern in the four-hour chart.
Euro is in the correction after a-week-long rally. It is 1.1010 in FX Margin and 1.1051 in futures CME as of 10:38(UTC). It is around bottom band of Bollinger Bands in one-hour chart.
Though euro may fall against dollar, it is still valid to keep long bias on euro.
Dollar rose sufficiently since US-Sino Trade War and coronavirus outbreak. As the US real economy is affected by the pandemic, greenback gradually falls.
When the pandemic spreads around the world, panic investors sold the risky asset and bought only US dollar. Dollar Index, dollar's value against the basket of major six currencies rose above 100 and the stock markets were bearish and panic.
As the COVID-19 patients increase in the United States as did in Europe and Asia, dollar falls against euro. Dollar Index falls to 99.25 as of 11:14(UTC).
The unemployment claims hit 3 million 283 thousands recording high, it lowered dollar, too. It means that the pandemic affect US real economy and a lot of workers, more 3 millions, were dismissed in the last week.
I recommend that the trade should be cautious, because its rising doesn't mean the upward trend yet.
When recalling the memory in global finance crisis 2008, all gauges were out of order and dollar surged. It was financial crisis and this crisis is pandemic and real economy problem.
US Parliament agreed the packages worth more than $ 2 trillion, including one-off funds for individuals, increased unemployment benefits, corporate support including small business loans and debt relief, and state support. It is expected to come into effect shortly after the House of Representatives vote and the signature of US President Donald Trump.
Though euro rises, the main trend line since summer 2008 is downward. When euro rises to 1.19, it may meet the trend line. The currency pair of EUR/USD is just 1.10s.
Gjallarhorn has a long position of euro at futures, CME.
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