Greenback pulls back, euro recoups losses.
“US GDP slumped by 1.4% during the first quarter.”
Greenback shies away from its recent 20-year high as risk sentiments began to improve on the final day of trading for the month. Yesterday, investors were delivered with disappointing news as recent economic data shows significant contraction in terms of economic growth. Preliminary reading of Gross Domestic Product for first quarter came in at -1.4%, a major pullback when compared to 6.9% from the previous quarter. The slump was due to rising Omicron cases in the US at the start of the year, dampening economic activities across the board. Nonetheless, market expectation towards 50-basis point rate hike from Federal Reserve remains intact, evident from latest data on CME (Chicago Mercantile Exchange) FedWatch Tool. Price of goods continues to climb during the quarter, as GDP price index deflator rose 8% after jumping 7.1% in the last quarter.
Quick recap on EURUSD
The pair loses its grounds after breaching key level near 1.0853.
EURUSD Weekly Technical Analysis
The pair has extended its losses after breaching 2 years low at 1.0656.
EURUSD Daily Technical Analysis
However, the pair begins to stage its rebound in daily chart, suggesting probable upside momentum ahead in the near-term.
Order: SELL LIMIT
STOP LOSS: 1.0800
Target 1: 1.0400
Target 2: 1.0300
ZFX Analyst’s Comment
We will see EURUSD to recover its losses in the short-term, evident from recent pullback in the dollar index. For the time being, we will monitor for its clear re-test near 1.0656 which may spark more bears to pick up and steer its course thereafter.
Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
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