Today we shall take a look at the EUR/USD currency pair. The rate of this pair appears to still be within the bullish rally that started at the end of March. It is now trading at the highest level in five weeks and remains above 1.20 for the moment.
Over the past couple of weeks the European single currency has reminded investors that it is to be taken seriously. Fundamental reports from the eurozone have either met the forecasts or proven to be better than them, giving the euro no reason to weaken. In addition, despite many glitches in the beginning of 2021, now the vaccination campaign in Europe appears to be going better. Vaccines are being delivered more or less on schedule and countries are trying to distribute them to more of the population. Moreover, the euro is currently strengthening because risk appetite has returned to the market. The economic situation is stabilizing in Europe, but it is downright improving in the United States, and that is driving investor interest away from safe havens like the dollar and into riskier assets such as the euro.
Indeed, the USD has given up ground against several major currencies in recent days. Thanks to ample stimulus from the Federal Reserve and Joe Biden’s administration, the economy is well-supported. As a result, there have been solid improvements in inflation, payrolls, and retail sales, which are signs of an economic recovery. The dollar’s only chance to strengthen now will occur if there are signs of problems again which can spook investors and inspire more demand for safe havens.
In terms of the daily chart, today we have a pivot point for the pair located at 1.1973, with the price currently trading above it. The daily support levels lie at 1.1962 and 1.1957. The daily resistances are located at 1.1989 and 1.1995, both overcome. The indicators of technical analysis strongly agree in recommending a buy position today.
