On Tuesday, February 25, the euro was up at the close of trading. An active growth phase was observed at the American session. Bulls set a new weekly high by recouping their daily losses. The dollar has been under pressure for the third consecutive session amid speculation that the Fed could lower interest rates and US stock indices fell by another 3% yesterday. Reports of the continued spread of coronavirus in Italy, South Korea, as well as other European countries and the United States have had a negative impact on financial markets.
In Italy, the number of cases increased to 322 people, and the death toll is up to 10. On Sunday, South Korean authorities announced the highest, “red,” threat level amid a skyrocketing number of people infected with the novel virus. As of Wednesday, 1,146 cases of the disease were confirmed and 10 deaths had been recorded.
Today’s events (GMT+3):
- 16:30 Eurozone: ECB President Christine Lagarde speech.
- 18:00 USA: New Home Sales Change (MoM) (Jan).
- 18:30 USA: EIA Crude Oil Stocks Change (Feb 21).
An upwards movement is developing within the channel. Resistances levels are located at the 67th degree. The euro jumped up on expectations that the Fed would lower interest rates, but the regulator is unlikely to do so before July.
According to the forecast, today I am considering a fall down to the 45th degree - 1.0837. There are several reasons for this. The first is that a bearish divergence has formed between the AO indicator and the price. The second is a rebound from the upper line of the channel. The third is the scheduled speech by ECB President Christine Lagarde.
On the way to 1.0837, the level of 1.0855 will act as an intermediate resistance. Besides Lagarde's speech, there is no important news expected today for the euro.