The Single currency closed slightly lower yesterday after the US Dollar was heavily bid across the board ahead of the US Federal Reserve Chairman Jerome Powell’s testimony to Congress. After Friday’s upbeat US NFP and the trade truce between US-China, Chair Powell may sound less dovish-than-expected, pushing both treasury yields and the US Dollar higher. The greenback, however, will likely take a beating if Powell reiterates and stands firm on his rate cut policy. Moreover, the Euro remained under pressure throughout the day after France’s central bank governor didn’t rule out more stimulus for the Euro-zone coming as early as this summer if trade uncertainty continues to affect the economy.
The Euro remained below a key resistance level, 1.1250, as price action found support just above 1.12 but stayed weak during yesterday’s session. The bulls will likely attempt to retest 1.1250 in today’s session, that’s where the sellers will probably show up and put pressure on the single currency. The bears will remain in control as long as price is trading below 1.1250 and the 200-day moving average.
Support: 1.12 / 1.1180
Resistance: 1.1250 / 1.1270