EURUSD analysis 01.05.2020

The single currency fluctuated the euro in a narrow range slanting back down during the Asian session to witness its bounce for the second session from the top since April 15, when it tested the highest for it since the beginning of the same month against the US dollar amid the dearth of economic data by the eurozone economies due to the Eid holiday The workers are on the cusp of developments and economic data expected Friday by the US economy, the largest economy in the world.

At 05:38 am GMT, the euro against the US dollar fell 0.05% to 1.0949 levels, compared to the opening levels at 1.0955, after the pair achieved its lowest level during the trading session at 1.0935, while achieving the highest at 1.0956.

The markets are looking to reveal the final reading of the manufacturing PMI by Markit for the United States, which may reflect the stability of the contraction at $ 36.9, little changed from the initial reading of last month and compared to deflation at 48.5 in March before we witnessed by the economy The US construction spending index released showing the decline widened to 3.5% versus 1.3% in February.

This comes in conjunction with the disclosure also by the largest industrialized country in the world about the reading of the Institute of Industrial Supply index, which may show the breadth of deflation to 36.7 compared to 49.1 in March, as the reading of the Institute of Industrial Supply measured in prices may show the extent of deflation to what it valued 30.7 vs. 37.4, and we would like to point out, because the reading at a value of 50 or higher reflects a widening, while it's reading less than 50 indicates a contraction.

Other than that, we followed yesterday the Federal Reserve announced a new stimulus program to provide financing to citizens directly, and this came after the Federal Open Market Committee decision in the April 28-29 meeting to keep interest rates at between zero and 0.25%, which It came in line with expectations, and the members of the committee stressed that they are going forward to use all the tools of the Federal Reserve to support the American economy in these difficult times.

Technical analysis

EUR / USD trades stabilize at our first positive target 1.0966 after yesterday's bullish rally, and the positive impact of the inverted head and shoulders pattern is still effective, so we recommend breaching this level and pushing towards our positive target of 1.1067.

Thus, the bullish trend will be expected during the upcoming sessions supported by the EMA50, noting that breaking the 1.0885 then 1.0840 levels will stop the expected rise and press the price to drop again.

The expected trading range for today is between 1.0880 support and 1.1060 resistance.

Expected trend for today: bullish.