The Euro continues its slight rise upwards as risk appetite improves and Brexit negotiations progress. Since Wednesday, risk appetite shifted to a positive note benefiting high beta currencies such as the Euro. Improvement in risk appetite is attributed to investors feeling optimistic about the future trade relations between the US and China which will be clearly discussed during the G20 summit by the end of the month. The Euro was also supported by positive Brexit progress. Note that the specific deal dynamics will be presented in Brussels this Sunday during an EU summit. Investors need to keep in mind that the positivity around the Brexit deal might be temporary as the agreement has to yet be approved by the British parliament. For today, investors need to keep an eye on anything significant related to Brexit, as well as the disagreement between the EU and the Italian government in regards to the controversial Italian budget plan for 2019. Additionally, investors need to also monitor the results of key economic data coming out for the Eurozone with the German GDP, Eurozone Manufacturing PMI, and Eurozone Services PMI taking center stage.
The pair continues to range between the 200-period moving average and the 50-period moving average. Such movement can be explained by indecision and uncertainty within the market. The pair is expected to continue trading in this range until a major fundamental trigger takes place. Depending on this trigger, the pair will either break above the 1.1431 resistance exposing the next level at 1.1468 or break below the 1.1358 support exposing the next level at 1.1320.
Support: 1.1358 / 1.1320
Resistance: 1.1431 / 1.1468