The EUR/USD pair has traded mixed on Thursday morning, April 23 after falling in the previous session.
On Wednesday, EUR/USD closed in on the 1.08 mark as defensive currencies, mainly the dollar, were still in demand. The greenback retreated within a few hours yesterday as risk appetite temporarily increased and oil rebounded, and by the end of Wednesday the dollar was back on an upward track.
The investment community continues to monitor what measures governments around the world are taking to contain the coronavirus.
President Donald Trump claimed yesterday that businesses are gradually restarting operations as part of the first stage of a plan designed to lift lockdown restrictions, but there are differences of opinion between authorities from various states and the Trump administration about the procedure and the timeline for reopening businesses. Moreover, a disagreement re-emerged between Donald Trump, who does not expect a new wave of the coronavirus in the fall and chief US infectious disease professional Anthony Fauci, who warns that Covid-19 is likely to resurface this autumn.
Notably, the US House of Representatives is expected to approve today another package aimed at supporting the economy due to the coronavirus pandemic. Moreover, EU leaders will hold a key meeting to discuss measures needed to restore the economy after the pandemic and coordinate support measures among European countries. In this regard, disagreements among EU member states are quite serious.
On the data front, German and Eurozone manufacturing and services PMIs (preliminary) are due out, and the median consensus for these indicators is dismal. The Eurozone’s manufacturing PMI (preliminary) is expected to come in at 39.2 in April vs. 44.5 in March, and the services PMI is projected to reach 23.8 compared to 26.4. Grim macro data could put pressure on the single currency during European trading.
From a technical standpoint, the daily chart shows that EUR/USD has broken out of a triangle to the downside, while holding some downside potential in the short term. The closest support level is 1.0786.