EUR/USD: graphic figure in bullish triangle

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The EURO / Dollar currency pair capped in contact with a graphic resistance zone ($ 1,1460), pending concrete conclusions on Sino-American talks. In the meantime, the trades digested the Council of Governors of the ECB, completed last week. If the central bank based in Frankfurt has undoubtedly lowered its main key rate of 25 basic points, the slightly firmer tone adopted by C Lagarde at a press conference lets consider a long break in the monetary easing process, it is already well engaged on this side of the Atlantic.

“The president of the ECB has displayed unexpected firmness, claiming that the institution was” at the end of a monetary policy cycle “. A clear positioning, unusual on his part. Result: a break now seems acquired from the July meeting, and according to market expectations, it will probably be necessary to wait for a new decline,” anticipates Romanesque Ballin, bond manager of Auris Gestion. “The ECB therefore remains cautious, rightly so. The geopolitical climate, in particular the rise in trade tensions, complicates the equation. American customs duties, by slowing down activity, are rather disinflationist; on the other hand, the expected response of Europe could revive the pressures on prices.”

Price will be discussed at 2:30 p.m. (Paris time) with the main statistical publication of this Wednesday, namely inflation within the meaning of consumer prices (ICC) in the United States. To see, therefore, if this publication is able to reduce the tensions that weigh on the shoulders of J Powell, the president of the federal reserve.

“The task is tough for the Fed which is certainly waiting for more visibility on the trade war waged by the White House. Besides, on this point, we note the timid clarified between China and the United States. Donald Trump and Xi Jinping have finally spoken. It is their first direct exchange since the investiture of D.TRump and the two leaders agreed to take up the trade negotiations.”

The consensus is +2.5% in annualized data, for the widest basket of products.

On customs issues, Deutsche Bank notes that the President of the United States Economic Council, Kevin Hassett, told CNBC to expect “any control of American exports to be relaxed and that rare land will be released in volume”, after these negotiations.

“This therefore suggests a potential compromise in which the United States would relax its export controls in exchange for China easing by its own restrictions on rare earths,” concludes Deutsche Bank.

Chinese rare lands are a key issue in negotiations, the United States hoping that the pace of the expeditions of these strategic metals, which has slowed down since the US President launched his World Trade War, be restored, said AFP.

At midday on the foreign exchange market, the euro was treated against $ 1,1440 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. We have two of us. But a crossing of the $ 1,1,460 would immediately come to feed the upward dynamics of the next few weeks. A bullish triangle would then be validated.

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