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The Euro is trapped in a range despite the significant weakness of the US Dollar. Will the EUR/USD be breached? -by Ecork

EUR, EUR/USD, USD, USD/JPY, Yen, GBP, CHF, AUD, NZD, HSI – Talking Points

  • The euro struggles to make progress despite the dollar’s decline elsewhere
  • Most of the other major currencies continued to rise against the US dollar
  • At the end of a busy data week, I will The US dollar resumes its upward trend To sink EUR/USD?

The Euro has struggled to break out of the recent ranges despite the US dollar’s broad weakness in most other currency pairs. Issues arising from the Ukraine war seem to affect the single currency.

USD/JPY continues to slide to lows not seen since mid-June as the yield differential between Treasuries and Japanese Government Bonds (JGBs) narrows.

The Australian and New Zealand dollars are also big gainers in Asia today after the Australian PPI came in higher than expected at 5.6% y/y through the end of the second quarter.

The GBP/USD hit a 1-month high while the USD/CHF looks to a 3-month low.

Wall Street ended its monetary session on a positive note with major indexes up over 1%.

Disappointing US GDP numbers led the market to look for a less hawkish Fed with the perception that inflationary pressures may ease. A classic case of bad news is good news.

Treasury Secretary Janet Yellen He hit the wires and noted that inflation is unacceptably high and that addressing this is the administration’s top priority.

Positive leadership from North America helped Australian and Japanese stocks move towards the green, but the Chinese and Hong Kong bourses are affected by the declines.

The lack of stimulus measures announced at the conclusion of today’s Politburo meeting left the market vulnerable. Hong Kong’s Hang Seng Index (HSI) fell to a two-month low.

Commodities have been drifting higher overall with the dollar weakening, but iron ore is down today, based on concerns about the state of the Chinese economy. Gold and Crude Oil have stabilized so far today, maintaining recent gains.

US futures are pointing to a strong start to trading after Apple and Amazon reported solid profits after the close.

A two-hour phone call between US President Joe Biden and Chinese President Xi Jinping on Thursday was described as “candid and objective.” Plans are being made for an in-person meeting amid the backdrop of escalating tensions over Taiwan.

After a pile of Eurozone GDP and CPI numbers, Canada will also see GDP numbers. As the US labor market continues to tighten, salary report there Later today it will be closely monitored.

You can view the full economic calendar over here.

Technical analysis of the EUR/USD pair

The EUR/USD has been trapped in the 1.0100 – 1.0270 range for 10 days. These levels may provide support and resistance, respectively.

10 days Simple Moving Average (SMA) crossed above the 21-day simple moving average to form a golden cross. This may indicate that the bearish momentum is being challenged.

Schedule cread in TradingView

— By Daniel McCarthy, Strategist for DailyFX.com

To connect with Daniel, use the comments section below or Tweet embed on Twitter

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