EUR/USD: a deficited dynamic support

(BFM Stock Exchange) – This article, with free access, is produced by the research team in BFM Stock Exchange analysis and market strategy. To not miss any opportunity, consult all of the analyzes and discover our portfolios by accessing our privilege space.

For the first time since February 28, the pair of flagship currencies “closed” a candle below its mobile average at 50 days (in orange), which was used so far as graphic support. The digestion of the commercial “deal” signed between Washington and Brussels remains difficult on foreign exchange, the trades translating in their arbitrations the imbalance of this agreement.

This trade agreement brings back customs duties imposed by the United States on European imports at 15%. Without common ground, Washington would have inflicted customs taxes of 30% on Europe from August 1.

This agreement, described as “larger” never concluded in terms of trade by Donald Trump, includes a certain number of exceptions, with products taxed at 0% on the part of the two business partners, including aeronautical equipment, equipment for semiconductors, and certain agricultural products. But not alcoholic products whose fate must be decided “in the coming days,” said Ursula von der Leyen.

The text also provides that Europeans will buy $ 750 billion in energy products from the United States and will invest $ 600 billion in the country.

“Why so many gifts to the Americans?” Asked, indignant, Véronique Rich-Flores, independent economist. “The EU’s trade surplus with regard to the United States would have disproportionately increased in recent years”, Ms. Von Der Leyen, president of the Commission and negotiator for the EU who abounds in the direction of D. Trump and thereby forget that the Americans compensate for a large part of their deficits of goods by comfortable excess of services. “

“So, yes, 15 % are always better than 30 % or 50 % and it is likely that the investors will applaud this relief, or will do, at least, seeming to do so. Because, which can consider what is presented as an agreement, other than a racket whose Europeans will pay for both the economic note and that, even more bitter, of the humiliation of no more knowing how to do it but to bend and to do more than to make diktates Inexpensive.

The burdens will also have a lot to do this evening with the decryption of the language elements of the Fed press release which completes a monetary policy committee. Nothing to expect from the level of the level of remuneration of the Fed Funds, expected stable, but on the side of the monetary trajectory by the end of the year.

The CME Group Fedwatch tool is 97% the probabilities of status quoto the chagrin of Donald Trump, who continues to have his requirement to see the guiding rates melt, dealing with everything the boss of the Fed of “Nigaud” …

“Faced with this immobility, the President’s advisers accentuated their pressure on Jay Powell, accusing him of poor management of the renovation of the headquarters of the Federal Reserve for the modest sum of $ 2.5 billion. The argument does not seem to have taken a hit with investors, if we believe the Paris Polymarket site: the probability of a departure this year is only 18 %” Pincemaille, secretary general of management at DNCA Finance.

“At the discharge of the Fed and its president, the mission of controlling inflation seems if not impossible, at least very difficult. Indeed, the two major components of this economic equation (customs duties and businesses) are not frozen. After having concluded commercial negotiations with Europe, the American administration now seems to target the countries of Southeast Asia which are used for the bypass of the taxes imposed on China. Passed from 2.3 % at the start of the year to 13 % currently is still intended to evolve. “

In the statistical chapter on Tuesday, operators learned about employment data with new offers (Jolts), slightly below expectations. On the other hand, the consumer confidence index (Conference Board) believed 97.2 far beyond the target, confirming the excellent health of domestic consumption, structurally the first engine of national wealth creation across the Atlantic. At the macroeconomic agenda this Wednesday, to be followed in priority across the Atlantic, the results of the ADP monthly survey on employment at 2:30 p.m. and the Fed press conference at 8:30 p.m.

Ras on the German GDP side published this morning, in contraction of 0.1% in the first quarter, perfectly in line with the consensus formed by the first estimates.

At midday on the foreign exchange market, the euro was treated against $ 1,1550 approximately.

Key graphics elements

Formally the spot “closed” under the mobile average at 50 days, a support which served us as a work base for our buying positions on the pair of currencies. While waiting to note whether it is a beginning of a depression or a false outing, we will remain out of the spot. Neutral opinion proposed, therefore.

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 courses of Euro Dollar parity (EURUSD) are positioned between the support at 1,1460 USD and the resistance to 1,1970 USD.

Daily data graphics