The Euro extended its advance despite a delay in the European Union’s meeting for the purpose of agreeing a EUR 750 billion rescue package to deal with Europe’s economic slump due to Covid-19. EUR/USD finished in New York at 1.1450 (1.1427 yesterday), a gain of 0.38%. European Union leaders appeared close to an agreement on the massive stimulus plan after the chairman presented a proposal to bridge gaps between them. A group of four fiscally frugal northern nations (Denmark, Austria, the Netherlands, and Sweden) opposed the level of free grants within the proposed recovery fund of up to EUR 750 billion overall. EC Council President Charles Michel proposed that within the EUR 750 billion fund, 390 billion should be in non-repayable grants, down from EUR 500 billion originally proposed (which the frugal four opposed), with the rest in repayable loans.

Markets have been bullish on the Euro which has rallied remarkably from its lowest point in March near 1.0650. This morning early Asia continues to drive the shared currency up, settling at 1.1456 as this is written. Market positioning in the Euro remains long at multi-year highs. The immediate resistance level at 1.1470 should cap any short-term gains until the EU formally agree on a package. The next resistance level is found at 1.1500. Immediate support can be found at 1.1420 followed by 1.1380. Look for a likely trading range of 1.1385-1.1465 today. Prefer to sell into any rallies.