EUR/USD: The forces balance on the pair of flagship currencies

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The lack of new developments in the intense trade war in Trump against the rest of the world, and particularly China, mechanically translated into a consolidation on the pair of flagship Eurusd currency. Recall that the trend is the hope of a de -escalation between Washington and Beijing, and that we are in the “frost” period, for 90 days, of customs surcharges imposed on the European Union.

“We will have to see what will happen from now on, but a large part of optimism is due to the fact that investors think that the American administration will give in more. This point of view has been corroborated by the Wall Street Journal of yesterday, which suggested that the customs duties imposed on China could be revised downwards,” explains Deutsche Bank.

Wednesday, the Wall Street Journal reported that American customs duties against China could be brought around 50-65% against 145% at present.

“The American president simply resumed, with a very direct style, the remarks made by his secretary of the Treasury at a meeting with investors organized by JP Morgan on Tuesday in Washington. On this occasion, he had recognized that the reciprocal embargo between China and the United States was not intended to last and that it was above all a political post. Begun but that they cannot be long. In addition, in addition to the question of customs rights, there will also be intense exchanges on intellectual property and access to rare land – two points which are very important for the White House “, decrypts Christopher Dembik, advisor in investment strategy at Pictet AM.

In the statistical chapter, note the publication of weekly registrations unemployed in slight increase and an explosion of orders of lasting goods. It should be noted that this explosion of more than 9% monthly is mainly due to the car vehicle component. Would the Americans have anticipated their orders from Volvo, BMW and other Toyota before the application of prohibitive customs duties? … On the European side, market operators have read the very follow -up IFO of the business climate in Germany, the first economic power of the euro zone. It appears almost stable and close to expectations, at 86.9 points. The economic cycle graphic tool remains stuck in the “crisis” box, for its part.

To be followed by priority, the revised data of the consumer confidence index (U-Mich), at 4:00 p.m. Very followed, they came out at 50.8 in first estimate.

At midday on the foreign exchange market, the euro was treated against $ 1,1350 approximately.

Key graphics elements

Consolidation in triangle from 04 to 09 April is now over, the pair of currencies being violently out from the top. The energy released is important, but the ease with which the Eurusd shatters the resistances augurs for a pursuit of height. An accumulation zone between 1,1460 and 1,1674 is identified, as well as a bullish lens $ 1,1970.

Medium term

In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on Euro dollar parity (Eurusd).

We will keep this neutral opinion as long as the EURO Dollar parity prices (EURUSD) are positioned between the support at USD 1,1250 and the resistance to 1,1460 USD.

Daily data graphics