EURUSD Turns Range Bound As Greenback Takes A Breather

Euro managed to add some ground this Thursday on dollar’s weakness, but the advance was quite shallow, as local data dented the common currency. German figures were unimpressive, as the GFK Consumer Confidence survey printed 10.7 in May, slightly below the previous 10.8, while Q1 GDP remained unchanged at 0.3%. Also, the ECB released its account of latest monetary policy meeting which was viewed overall as dovish, as policymakers remain confident inflation will rise in the medium term, despite lack of adequate signs to back such words. Furthermore, ECB highlighted during its meeting that “While risks surrounding the euro area growth outlook remained broadly balanced, it was acknowledged that risks related to global factors, including the threat of increased protectionism, had become more prominent and warranted monitoring with regard to their implications for the medium-term outlook for growth and prices” which is widely viewed by investors as dovish statement.

EURUSD Steady

US data was disappointing, with unemployment claims up to 234K for and Existing Home Sales falling by 2.5% in April resulting in major triggers expected during Thursday’s session leading to bearish market sentiment. Macro Calendar has provided mixed output in last 48 hours causing Greenback’s momentum to slow down significantly. Risk sentiment heated up after US President Trump released a letter to its North Korean counterpart, canceling the meeting scheduled for June 12th. Nevertheless, the rally to safety stalled after the initial shock. Today’s Calendar in Europe is pretty light except for German Ifo Business Climate update while US Calendar is expected to be quite active with US Durable goods order update and speech by Fed Chair Jerome Powell & Few FOMC Board members.

While EUR saw some uptrend movement post Fed Minutes, the correction remained well within Wednesday’s price range and Asian market hours of Friday saw the pair turn range bound with momentum slightly favoring US Greenback. US Treasury Yields remain dovish which is another major factor for slow down in greenback’s momentum. So far the pair has managed to remain above 1.17 handle as the pair continues to move below it moving average, and is currently trading around 1.17080. Expected support and resistance are at 1.1695 / 1.1660 / 1.1620 and 1.1745 / 1.1790 / 1.1830 respectively.