EURUSD analysis 14.05.2020

The single currency fluctuated the euro in a narrow range slanting back down during the Asian session to witness its bounce for the second consecutive session from its highest since May 5 against the US dollar on the cusp of developments and economic data expected today Thursday by the eurozone and the US economy, which includes a recent talk Federal Open Market Committee Neil Kakkari later today.

At exactly 05:51 am GMT, the euro pair rose against the US dollar, 0.07% to 1.0810 levels, compared to the opening levels at 1.0818, after the pair achieved its lowest level during the trading session at 1.0805, while achieving the highest at 1.0824.

Markets are looking for the largest Eurozone economies to disclose inflation data with the final reading of the consumer price index, which may reflect the stability of growth at 0.3%, unchanged from the previous initial reading in April and against 0.1% growth in March. The past, in conjunction with the release of the wholesale stock price index also for Germany, which may explain the decline in the decline to 0.3% compared to 0.4% in March.

This comes, before we witnessed by Italy, the third-largest economy in the euro area, the release of the trade balance reading for March, in conjunction with the European Central Bank's unveiling of the European Central Bank’s monthly report. Otherwise, we followed yesterday the statements of German Chancellor Angela Merkel in which he expressed The fact that the Coronavirus is continuous and being coexisted and that it will remain that way for some time.

Merkel also noted that since the beginning of the Coruna outbreak it has been worked to contain the epidemic with clear that we will not be able to stop the coronavirus, adding that the health system of Germany can deal with the current infection rates and that it would be frustrating to re-impose the closures again while telling her with the government's care On the return of citizens to their jobs soon, and with its discussion of the fact that the euro currency is a currency of global importance and that it should have a scientific value of greater importance.

On the other hand, investors are currently awaiting by the American economy for the release of the index of subsidy requests for the last week on the ninth of May, which may reflect a decline of 669 thousand requests to 2,500 thousand requests compared to 3,169 thousand requests in the previous reading, while the reading of subsidy applications may appear Continuing for the last week in the second of this month, increasing by 2,453 thousand requests to 25,100 thousand requests compared to 22,647 thousand requests.

This comes in conjunction with the release of the import price index, which may explain the widening decline to 3.1% compared to 2.3% in March, and hours after Federal Reserve Governor Jerome Powell expressed yesterday that "despite the fact that the economic response was timely and large enough, However, it may not be the last chapter, given that the road ahead is very uncertain and subject to great risks. "

Powell also warned that the potential economic recession may be deeper and longer without additional fiscal stimulus, which reduced appetite for risk among investors, especially with the uncertainty that markets are witnessing in reopening global economies and easing the social divergence measures that have been imposed as part of efforts to curb the spread of Coronavirus previously, which could lead to a possible second wave of deadly virus outbreaks with re-opening.

Technical analysis

The euro against the dollar ended yesterday's trading below the level of 1.0840, to head towards a possible decline during the upcoming sessions, but we notice that the price is moving within a bullish intraday channel whose support is at 1.0790, it needs to break this support to confirm the continuation of the decline.

Therefore, we prefer stopping on neutrality now until one of the following directional keys which are support 1.0790 and resistance 1.0840 are breached, indicating that breaching the mentioned support will push the price towards 1.0700 then 1.0640 as the next negative targets, while breaking the resistance will lead the price to achieve new gains that reach 1.0966 near term.

The expected trading range for today is between 1.0700 support and 1.0900 resistance.

Expected trend for today: It depends on the levels mentioned in the report.