EUR/USD bounces off lows near 1.0480 on Friday
After bottoming out in the 1.0480 region earlier in the session, EUR/USD manages to regain some buying interest and now reclaims the area further north of the 1.0500 barriers. EUR/USD regains some composure following Thursday’s sharp selloff and after dropping to fresh multi-session lows in the 1.0485/80 band during early trade. Indeed, some selling pressure in the greenback sponsors the ongoing bounce in the pair well north of 1.0500 the figure as the sentiment in the risk-associated universe appears somewhat improved in the European morning. Also lending some support to the shared currency, ECB’s Villeroy suggested that the bank’s policy rates could return to the positive territory by the end of the year. In the same line, the German 10y bund yields climb to fresh peaks near 1.10% for the first time since later July 2014.
EUR/USD came under renewed downside pressure in the wake of the FOMC event. The downtick, however, seems to have met contention around 1.0480 so far this week and ahead of the key NFP due later on Friday.
The outlook for the pair still remains tilted towards the bearish side, always in response to dollar dynamics, geopolitical concerns, and the Fed-ECB divergence. Occasional pockets of strength in the single currency, in the meantime, should appear reinforced by speculation the ECB could raise rates at some point around June/July, while higher German yields, elevated inflation, and a decent pace of the economic recovery in the region are also supportive of an improvement in the mood around the euro. So far, the spot is gaining 0.18% at 1.0558 and faces the next up barrier at 1.0641 (weekly high May 5) followed by 1.0936 (weekly high April 21) and finally 1.1000 (round level). On the flip side, a breach of 1.0470 (2022 low April 28) would target 1.0453 (low January 11, 2017) en route to 1.0340 (2017 low January 3, 2017).
The outlook for the pair still remains tilted towards the bearish side, always in response to dollar dynamics, geopolitical concerns, and the Fed-ECB divergence. Occasional pockets of strength in the single currency, in the meantime, should appear reinforced by speculation the ECB could raise rates at some point around June/July, while higher German yields, elevated inflation, and a decent pace of the economic recovery in the region are also supportive of an improvement in the mood around the euro. So far, the spot is gaining 0.18% at 1.0558 and faces the next up barrier at 1.0641 (weekly high May 5) followed by 1.0936 (weekly high April 21) and finally 1.1000 (round level). On the flip side, a breach of 1.0470 (2022 low April 28) would target 1.0453 (low January 11, 2017) en route to 1.0340 (2017 low January 3, 2017).