EURUSD analysis 23.04.2020

The single currency fluctuated the euro in a narrow range slashing up during the Asian session to witness its rebound to the second session from the lowest since the seventh of April this year against the US dollar on the threshold of developments and economic data expected Thursday by the economies of the euro area and the US economy the largest economy in the world.

At 05:23 am GMT, the euro pair rose against the US dollar by 0.05% to 1.0828 levels, after the pair achieved its highest level during the trading session at 1.0829, while achieving the lowest at 1.0805.

Investors from the largest euro-area economies, Germany, are looking to unveil a statistical reading of the GFK index of consumer confidence, which may reflect a contraction of 1.9 compared to 2.7 in April, before seeing France, the second-largest economy in the region and Germany, in addition to the eurozone as a whole. The first reading of the Markit index for industrial and services purchasing managers for the current month, which may reflect the widening contraction.

On the other hand, investors are currently awaiting by the American economy the release of the index of subsidy requests for the past week on April 18, which may reflect a decline by 895 thousand requests to 4,350 thousand requests compared to 5,245 thousand requests in the previous weekly reading, while it may appear reading requests The continuous benefit for the last week on the 11th of this month, increasing by 5,295 thousand requests to 17,271 thousand applications compared to 11,976 thousand requests.

This comes before we witness the revelation of the initial reading of the Markit Industrial and Service Purchasing Managers Index for the United States, which may reflect the widening contraction of the industrial sector in the largest industrial country in the world to a value of 35.1 compared to 48.5 in the previous reading last March, as we may witness The service sector contracted to 30.5 compared to 39.8 in March.

To reveal the housing market data from the release of the New Home Sales reading, which may explain a 16.0% decline to 643 thousand homes compared to a 4.4% decline at 765 thousand homes last February. In another context, we followed yesterday, and US Treasury Secretary Stephen Mnuchin expressed The fact that his country needs to boost fiscal spending and that 60 million workers is likely to find assistance from the business loan program.

The US Treasury Secretary mentioned Manuchin that the cost of lending to workers who will get loans will be low, given that the interest on federal funds is currently at zero levels, and that came with his discussion that the United States will provide $ 2.6 trillion directly to support the largest economy in the world. Facing the repercussions of the coronavirus outbreak, it reported that the Federal Reserve was providing $ 4 trillion in liquidity.

Other than that, we followed last Tuesday, the Senate announced the agreement of the polar American policy the ruling Republican Party, which has the majority of the Senate and the Democratic Party with the majority of the House of Representatives, on a program to support small companies and medical centers worth $ 484 to address the consequences of the outbreak of the Coronavirus, including $ 320 Billion for small businesses The bill is expected to pass in the House of Representatives later today.

It is reported that US President Trump recently announced his administration's plan to gradually restart and operate the American economy, indicating that the global medical crisis may subside later, while its economic consequences remain, and according to the latest figures issued by the World Health Organization, the number of cases infected with the Coronavirus has increased to Close to 2.48 million and 169,151 people were killed in 213 countries.

Technical analysis

The EURUSD pair confirmed the breach of the 1.0840 level after the daily candle closed below it, to activate the bearish trend scenario in the intraday and short term, on its way to achieving negative targets that start at 1.0700 and extend to 1.0640.

The descending channel that appears in the picture organizes the suggested descending wave, which gets support from the EMA50, taking into consideration that the expected decline will remain valid unless 1.0840 then 1.0870 levels are breached and stability above it.

The expected trading range for today is between 1.0700 support and 1.0870 resistance.

Expected trend for today: bearish.