Trading | 5 months ago
Stronger and Encouraging economic reports from the different sectors of United states drove the US dollar higher against all of the major currencies including EUR and JPY. The report shows that businesses are reopening and economic activity is accelerating in multiple sectors. The US jobless claims fell to 684,000, its lowest level in more than a year.
The United states economy is moving in the right direction. The government has also revised the fourth quarter GDP growth from 4.1% to 4.3%. Investors are buying U.S. dollars over EUR as the new wave of economic lockdowns and restrictions on several businesses due to rising COVID-19 cases is likely to continue in the Eurozone. This continuous restriction will have a significant impact on the EUR/USD Pair.
Currently EUR/USD pair is trending in a downtrend. The downtrend is likely to continue due to various factors. From last three months, EUR/USD is continuously going down. So far EUR/USD is down by 2.38% this month. Today EUR/USD is consolidating at $1.176 price level which is also a major support. If EUR/USD breaks this support, then we can see an additional 1% fall in EUR/USD value. EUR/USD is also suffering from the downside momentum in the four-hour chart and is trading below the 100 and 200 Simple Moving Averages.
The Relative Strength Index indicator is just around 30 which shows that price can fall further without any upside support. Investors were encouraged by the United States positive economic data reports. One must look for short-term selling opportunities in EUR/USD.
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