The Euro starts the week on a negative note as the weekend’s Brexit talks fail to conclude in a deal. In the past few weeks, investors were expecting a deal to be reached as early as today. However, this outcome does not seem likely anymore as UK and EU negotiators struggle to agree on some issues, most notably the Irish border. With the negotiators struggling to strike a deal, investors see the odds of a “no deal” Brexit increasing which is leading them to prefer safe haven currencies over high beta currencies such as the Euro. Along with any developments related to the Brexit negotiations, investors need to also monitor the release of today’s Retail Sales figures from the U.S which are projected to have a strong impact on the U.S currency.
The Euro is currently trading between the 1.1517 support and 1.1631 resistance. Depending on any development relating to the Brexit negotiations, the pair will either break above the 1.1631 resistance level exposing the 1.1710, or break below the 1.1517 support level exposing the 1.1438 level. Keep in mind that the U.S Retail Sales figure might also have an impact on the currency and will drive the pair in either direction depending on the results.
Support: 1.1517 1.1438
Resistance: 1.1631 1.1710