The EUR/USD currency pair erased some of its previous day gains but still traded above the one-month high of 1.1400 and extended its previous winning streak while represented 0.06% gains on the day. However, the gains in currency pair could be attributed to the modest upbeat trading sentiment backed by the vaccine hopes, which undermined the broad-based U.S. dollar and contributed to the currency pair gains. The concerns that the European leaders will make progress in agreeing on a roughly €1.85 trillion package also supported the shared currency to stay bid.
At the moment, the EUR/USD currency pair is currently trading at 1.1389 and consolidating in the range between 1.1378 – 1.1395. However, the traders seemed cautious to place any strong position ahead of European Union Meeting, which is scheduled to happen later on the day.
It is worth mentioning that the European Union (E.U.) leaders will meet physically in the U.K. on Friday to discuss the coronavirus fiscal stimulus plan and a new long-term E.U. budget. The EUR/USD pair’s movement seemed rather unaffected by the latest ECB monetary policy update. As we know, the European Central Bank decided to maintain the status quo and left key interest rates unchanged. Given that the decision was in line with market expectations, that’s why the announcement did little to provide any meaningful impetus.
Apart from this, the modest upbeat market sentiment was supported by the hopes about the coronavirus vaccine, which overshadowed the fears of the ever-increasing numbers of the virus. Dr. Anthony Fauci, the leading expert on infectious diseases in the U.S., also hinted that the country would meet its goal regarding COVID-19 vaccine by year’s end, spurring hopes of an economic recovery.
Apart from this, the U.K. scientists have also reported their breakthrough in vaccine development. A trial for a COVID-19 vaccine being developed by researchers at Oxford University involving 5,000 volunteers is currently in Brazil’s progress. Pharmaceutical company AstraZeneca (LON: AZN) has also agreed to mass-produce the vaccine. In turn, this undermined demand for the safe-haven broad-based U.S. dollar and became a key factor that supported the currency pair.
At the coronavirus front, the United States reported at least 75,000 new COVID-19 cases, a new daily record. At the same time, Washington state COVID-19 cases rise by 1267 on Thursday to a total of 44313, the highest single daily increase since the pandemic started. In the meantime, the total number of cases in Texas rose by 10291 on Thursday to a total of 292656. Although, the deaths toll increased by 129 to 3561 total, highest single-day increase, and record increase for the second day in a row.
Despite the ever-increasing number of new coronavirus cases and the possibility of renewed lockdowns, the broad-based U.S. dollar failed to put any bid and reported losses on the day. However, the losses in the U.S. kept the pairs’ prices high. Whereas, the U.S. Dollar Index that tracks the greenback against a basket of other currencies was down 0.07% to 96.250 by 9:55 PM ET (2:55 AM GMT).
The market traders await the European Union (E.U.) meeting, which is expected to happen on the day. Whereas, the market traders will keep their eyes only on the USD price dynamics and coronavirus headlines, which could play a key role in influencing the intraday momentum amid the absence of the major data/events on the day. As well as, the traders will keep their eyes on the virus updates and news concerning China.
The EUR/USD is taking a bearish turn after placing a high around 1.1439 level. The closing of candles below 1.1439 level has extended selling until the 1.1370 level. Closing of candles above 1.1370 level can drive buying in the EUR/USD pair, but in case, the bearish breakout occurs, we may see EUR/USD prices dropping towards 1.1335 level. Check out a quick trade plan below.
Entry Price – Buy 1.13998
Stop Loss – 1.13598
Take Profit – 1.14398
Profit & Loss Per Standard Lot = -$400/ +$400
Profit & Loss Per Micro Lot = -$40/ +$40
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