April 12th, Euro drifts near the balance line

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At the end of last week, major currencies showed an increase, except for the British. The largest gains against the US dollar were shown by the Swiss franc (+ 1.81%). A smaller increase was recorded by the euro (+ 1.16%), the Japanese yen (+ 0.94%), the Canadian dollar (+ 0.42%), the Australian dollar (+ 0.13%) and the New Zealand dollar (+ 0.01%) ). Only the pound declined (-0.84%).

On Friday, April 12, at the end of the day, the euro rate fell by 0.13%, to 1.1898. Before the weekend, trading on the market was calm. EUR/USD traded in a limited range and closely followed the movement of 10-year US bonds.

Scheduled statistics (GMT +3):

  • 12:00 the eurozone will report the February retail change.
  • 17:30 in Canada, the Bank of Canada business outlook review will be released.
  • 21:00 the US is to publish its March budget execution report.

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Current situation:

At the beginning of the Asian session, the dollar is trading in positive territory against major currencies. American bonds are becoming more expensive, so the strengthening of the dollar may be temporary. It is necessary to watch how the European bonds will be traded today.

In crosses, the picture is mixed in terms of dynamics, so it is important where the EUR/GBP pair will move. After a long period of growth, it can enter a correctional phase. In this case, the pound will receive support, the euro will remain under pressure. If at the auctions in Asia the strengthening of the US dollar is still temporary, then the EUR/USD pair will keep the sideways movement at the level of 1.1882. Supports are the levels 1.1860 m 1.1870. With a depreciating dollar and a decrease in the EUR/GBP cross, the euro could even strengthen to 1.1905.

There is another factor affecting the dynamics of the euro, these are US government bonds, which are now trying to rise in price. When bonds become more expensive, the yield decreases, which for 10 years is 1.655% per annum. The drop in profitability to 1.64% will increase the demand for the euro. In case of breakdown of 1.1905, buyers will be able to advance to the 1.1919 level.

Posted Using LeoFinance Beta



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