EUR/USD has been extending its fall as the trans-Atlantic virus gap favors the dollar. As FXStreet’s Analyst Yohay Elam notes, Tuesday's 4-hour chart is pointing to further losses after the pair hit the lowest since November.
The old continent continues struggling to immunize its citizens while the US is surging forward. By April 19, roughly 90% of Americans will be able to receive a COVID-19 vaccine, en route to President Joe Biden's 100% eligibility goal of May 1. The pace of immunization remains robust in the US while it lags behind in the old continent.
Details of Biden's infrastructure plans have begun circulating and they are pointing to investment in green energy and potentially no taxes on gasoline – at least in the first phase. If hikes of corporate taxes are deferred to the second stage of the plan, yields could further rise, also amid fears of inflation. The president is set to talk about the economy on Wednesday, but additional details about a two-pronged plan will likely come out beforehand.
Euro/dollar is trending lower as the 4-hour chart clearly demonstrates. Momentum remains to the downside while the Relative Strength Index (RSI) is still above 30 – thus outside oversold conditions.
Some support is at the fresh 2021 trough of 1.1740. The next cushion awaits at 1.1695, which held the currency pair up in October 2020. Resistance awaits at the previous 2021 bottom of 1.1760, and then by 1.1805, which recently capped it.