EURUSD, H4
The EURUSD pair managed to regain 1.0500 yesterday after dropping to a brand new low late final week within the 1.0350 zone, the identical space because the low seen in December 2016. This was partly because of the revised Q1 financial information for the Eurozone, with Q1 GDP revised up barely to the identical because the earlier quarter at 0.3% from 0.2% within the first studying and the revised annual fee elevated from 5% to five.1%, whereas the preliminary Q1 employment estimates have been up barely from the earlier quarter at 0.5% quarterly and a couple of.6% per 12 months.
Moreover, on Tuesday, ECB official Klaas Knot signaled the likelihood that the ECB would elevate rates of interest by 0.5% in July. In the meantime, monetary markets have now raised their bets for a year-end rate of interest hike to 1.05% from the beforehand projected 0.95%. Consequently, German authorities bond yields rose to 1.05%, approaching the multi-year excessive of 1.189% seen on Could 9.
On the US facet, in an interview yesterday Fed Chairman Powell mentioned the Fed will elevate rates of interest till inflation clearly subsides, and continued to emphasise the 0.5% rate of interest hike within the subsequent two conferences. The US retail gross sales report for April rose 0.9%, as anticipated, after a 1.4% improve final month, and retail gross sales excluding autos rose 0.6% from 2.1% in March.
Technical View
The EURUSD pair within the H4 timeframe has retraced above the MA50 line after seeing a bullish divergence on the finish of final week. Key resistance is within the Could excessive zone at 1.0640, which, if damaged, might shift the short-term outlook to a different bullish development. Nonetheless, if the worth breaks the MA50 down, there will probably be key help within the low 1.0350 zone. General within the Day timeframe, there’s a likelihood {that a} bear lure might present technical help for the pair to reverse its uptrend once more. Nonetheless, the uncertainty of the eurozone lingers on the protracted battle in Ukraine.
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Chayut Vachirathanakit
Market Analyst
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