Euro is trading marginally lower against the US Dollar.
The Euro (EUR) is under some modest negative pressure against the US Dollar (USD). Causing EURUSD to fall to the sub-1.0700 zone on Thursday morning in Europe.
In the same vein, the USD Index (DXY) tracks the Greenback around the 105.60 level. Against a backdrop of alternating risk appetite tendencies and increased caution. Ahead of Federal Reserve (Fed) Chair Jerome Powell’s event later in the European evening.
Powell of the Fed and Lagarde of the ECB will take the stage.
In terms of monetary policy, market participants are increasingly united. Participants believe the Fed will maintain its current monetary stance in the coming months. The prospect of an interest rate hike in December has lost some traction. Particularly following the latest FOMC meeting and the release of weaker-than-expected October Nonfarm Payrolls data.
A similar view can be seen regarding the European Central Bank (ECB), however the recent hawkish narrative from some rate setters appears to have opened the door to more tightening in the short-to-medium term.
President Christine Lagarde will talk in Brussels at 17:30 GMT on the domestic calendar.
At 19:00 GMT, Fed Chairman Jerome Powell will take part in a Policy Panel Discussion in the United States. Additional statistics will reveal the customary Initial Jobless Claims, which will be supported by speeches. Raphael Bostic of the Atlanta Fed (2024 voter, centrist) and Thomas Barkin of the Richmond Fed (2024 voter, centrist).
Daily market movers: The euro loses ground ahead of Lagarde
The EUR is acting prudently against the USD.
On Thursday, US and German yields rose slightly.
Markets anticipate that the Fed will maintain its present monetary policy in December.
The ECB appears to be considering a long-term pause until H2 2024.
Rate cut talk, according to ECB Vice President Luis de Guindos, is premature.
Furthermore Geopolitical tensions in the Middle East remain high.
CPI in China decreased 0.2% year on year in October.
Kazuo Ueda of the Bank of Japan favored maintaining the existing policy position.
Technical Analysis
Euro’s initial resistance arises near 1.0760 EURUSD trades in a consolidative range centered on 1.0760 Thursday’s price was in the 1.0700 range.
If the selling pressure continues, EUR/USD might fall to the weekly low of 1.0495 (October 13), ahead of the 2023 low of 1.0448 (October 15) and the round number of 1.0400.
On the upside, the November high of 1.0754 (November 6) stands in the way of the 200-day SMA at 1.0801 and another weekly high of 1.0945 (August 30). The psychological level of 1.1000 is oriented to the north of here, before the August peak of 1.1064 (August 10) and the weekly high of 1.1149 (July 27), all of which precede the 2023 peak of 1.1275 (July 18).
Moreover As long as the pair trades below the 200-day SMA, the prognosis is unfavorable.
