EUR/USD: PCE price with a magnifying glass

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Volatility remained relatively important on the EURO / Dollar currency pair, in a work band between 1.12 and $ 1,1460 for a euro, while the trades had “new”, this week, in the trade war led by Trump against the rest of the world.

This is a decision arbitrated by an American commercial court seized by a set of small businesses. According to this court, the application of customs duties by the White House is unconstitutional, these measures under the congress. The national emergency character argued by Donald Trump to justify this prerogative was therefore not retained. This decision, certainly awaited, will not discourage the American president in his trade war, but it is clear that this camouflet rained in the Asian markets, closing sharply on Thursday. The Dax and the CAC, for their part, sees at midday their opening gain stirring.

A White House spokesman denounced a decision taken by “non-elected judges” who “did not” manage a national emergency properly “. So far, the American president was based on the 1977 economic emergency law to proceed by decree on the issue of the increase in reciprocal customs duties.

It is a group of five small American businesses that is behind these proceedings. First of all, a New York import society of wines, spirits and other sake called your selections. Donald Trump’s threats to the alcohols (and innovatively French) have caused the officials of this small company founded in 1987.

The other complainants are quasi-anonymous companies who say they represent “the American worker”. We find in particular Fishusa, a company from Pennsylvania which sells fishing equipment, Genova Pipe which manufactures in the UTAH pipes and plastic fittings for plumbing or microkits, a manufacturer of music instruments from Virginie and finally Terry Cycling which markets cycling clothes from the vermont.

Not enough to put an end, of course, to the price offensives of Donald Trump. Bover, however, will see a brake stroke, in the form of a judicial camouflet.

In the statistical chapter, the unemployed weekly registrations have registered at 240,000 units over the closed week on May 24, against 230,000 units expected by economists while house sales fell 6.3% in April when the consensus awaited 1%. American GDP also fell 0.2% in the first quarter, according to a second estimate, against -0.4% for the first estimate. At the macroeconomic agenda this Friday, to follow the PCE prices at 2:30 p.m.; This is the predilection measurement for inflation for the Fed. Stable in March, the prices “Personal Consumption Expenditures” are expected on a very slight monthly increase of 0.1% for the month of April. To follow also, at 4:00 p.m., the revised data of the consumer trust index (U-Mich).

At midday on the foreign exchange market, the euro was treated against $ 1,1340 approximately.

Key graphics elements

The pair of currencies currently succeeds in the highly important graphic test of the mobile average at 50 days (in orange). A breath of breath is necessary before the conquest of new highests. That is to say the formation of several support on this trend curve.

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 1,1202 USD and the resistance to 1,1460 USD.

Daily data graphics