|Day's Range||1.128 - 1.128|
|52 Week Range||1.0655 - 1.1496|
Euro has been choppy during the early hours of Tuesday, from an initial rise higher to turn around and show signs of exhaustion, then turned right back around.
EUR/USD came under pressure in early trading after the EU commission revised down its economic forecast.
The direction of the EUR/USD the rest of the session on Tuesday is likely to be determined by trader reaction to the short-term pivot at 1.1295.
The EUR/USD is dropping as suggested on my live webinars and analyses. The last signal was a sell at 1.1325.
Also, USD/CNY rose 0.1% to 7.0207, with the dollar rebounding after the yuan hit its highest level in nearly four months after the sharp gains seen in the Chinese share markets.
European stock markets are set to open lower Tuesday, consolidating after Monday’s sharp gains, as investors try to balance signs of a global economic recovery with concerns over the increasing number of new coronavirus cases in the U.S. At 2:05 AM ET (0605 GMT), the DAX futures contract in Germany traded 0.7% lower. CAC 40 futures in France were down 0.7%, while the FTSE 100 futures contract in the U.K.fell 0.7%.
Risk appetite continues to support the majors. With the markets not expecting any shift from the RBA, geopolitics and COVID-19 remain curveballs.
The Euro surged much higher during the trading session on Monday, reaching above the 1.13 level yet again.
The direction of the EUR/USD the rest of the session on Monday is likely to be determined by trader reaction to the 50% level at 1.1295.
Demand for risky assets in early trading on Monday weighed on the dollar, causing EUR/USD to advance about a third of a percent.
The pound fell against the euro but held its ground against the U.S. dollar on Monday as traders looked ahead to this month's Brexit negotiations and more government support measures expected later this week. Traders expect more clarity by the end of July on whether Britain will agree a trade deal with the European Union. Britain left the EU in January, but it has full access to the bloc during a transition that runs until the end of December.
Investor morale in the euro zone improved for a third month running in July but a dip in expectations suggests the recovery from the impact of the coronavirus pandemic could soon peter out, a survey showed on Monday. Sentix's index for the euro zone rose to -18.2 from -24.8 in June. Investors said they expected that only around 60% of coronavirus-related economic losses would be recovered within a year in the euro zone.
The pound fell against the euro, as the common currency rose on Monday, and held steady against the U.S. dollar, as traders looked ahead to this month's Brexit negotiations and more government support measures expected later this week. Britain left the EU in January, but has full access to the bloc under a transition period that runs until the end of December.
Daily forecast and trading signals of forex majors, commodities, cryptocurrencies and indices.
If the Fed’s balance sheet has been a key driver of risk sentiment, will this dynamic start to weigh on risk? It seems unlikely to cause too great a stir as we know the Fed have the capacity to turn the taps on any time. Also, put China CN50 on the radar as this index is on fire right now, where we saw sizeable inflows into Chinese A-shares on Friday.
Additionally, the AUD/USD pair gained 0.6% to 0.6979, helped by rising prices for copper and other export commodities. The Reserve Bank of Australia will meet on Tuesday for its policy meeting and is expected to keep its key rate at 0.25%.
If the U.S. and Euro Zone economic data continues to impress then look for a strong rally to develop on a breakout over 1.1295.
The Euro went back and forth during the week, forming another wick that extended higher. However, the most recent wick was lower than the ones preceding it.
The Euro drifted a bit lower on Friday, but with the Americans being away for the observed Independence Day, there would have been a serious lack of volume.
The move comes at a time when traders are seeking alternative sources of capital value during an "uncertain macroeconomic climate."
The dollar edged lower in early European trade Friday, with volumes hit by the U.S. holiday and traders weighing the conflicting influences of positive economic data and the increasing number of coronavirus cases. Economic data released earlier Friday pointed to a brisk pickup in the Chinese service sector, with the Caixin Services Purchasing Managers Index coming in at 58.4 in June, the highest reading in two months. “Fed money printing has now secured what seems to be a stable negative correlation between risk assets and the dollar,” said analysts at ING, in a research note.
European stock markets are set to open just higher on positive signs of a global economic recovery, but ranges will be tight with the U.S. markets on holiday and the number of coronavirus cases still mounting. At 2:25 AM ET (0605 GMT), the DAX futures contract in Germany traded 0.5% higher, the FTSE 100 futures contract in the U.K. up 0.2%, and CAC 40 futures in France up 0.4%. The U.S. accounts for around a quarter of the 10.8 million coronavirus cases recorded worldwide.
Service PMIs from the Eurozone will be in focus today. Away from the figures, expect the markets to continue to respond to the U.S NFP numbers.