Euro Rally

EUR/USD – Remains Heavy with 1.0635 Key Support, 1.0800 Resists

Amidst the US Dollar’s reversal on Friday, the Euro managed to finish 0.24% higher in New York at 1.0692. The Euro rebounded against the generally weaker US Dollar to an overnight high at 1.08309 before easing. This morning in early Sydney, EUR/USD finds itself back to 1.0660 with key support at 1.0635 within reach. This level would have to hold for any recovery in the shared currency.

EURUSD 5Y Chart - Daily FX - 23 March 2020
EURUSD 5Y Chart – Daily FX – 23 March 2020

Reuters reported over the weekend that Germany’s Finance Minister Olaf Scholz said its debt ceiling will be raised to include a supplementary budget of EUR 156 billion. This would bring the total stimulus package of Germany to EUR 750 billion. While this would defy the country’s fiscal rulebook it will go a long way to battle the coronavirus epidemic. And would be supportive of the EUR/USD pair.

As the US grapples with the latest surge of Covid-19 cases in its own backyard, EUR/USD should climb. Immediate support today lies at 1.0640 followed by 1.0580. Immediate resistance can be found at 1.0780 and then 1.0830. Expect another choppy session with a likely range of 1.0640-1.0840. Prefer to buy dips.

Was this post helpful?