© Reuters. The Euro declined against the threat of tariffs to US
Investing.com – The EUR/USD pair dropped below the psychological threshold of 1.13 on Tuesday afternoon, adding to the downward phase that started last Friday.
The Euro seems to be suffering from rumors from the German magazine Wirtschafts Woche, according to which the american president Donald Trump could announce tariffs of 25 percent on all motor vehicles imported in the United States (including european vehicles), except from Canada or Mexico, which have a trade agreement with the USA.
The magazine also states that Cecilia Malstrom, responsible for International Trade at the European Commission, will travel to Washington tomorrow to discuss this possibility.
This information does not exceed, for the moment, not the stage of rumor, but the simple mention of this possibility seems to have scared traders on EUR/USD.
Thresholds to monitor in the short term on EUR/USD
The Euro-Dollar has in fact marked a low of 1.1290, the lowest since November 15. The Euro appears, however, to attempt to hold above 1.13 as a result of its low daily, for the time being.
From a technical point of view, if the pair confirms a break below 1.13 and stays below this threshold, the next support to consider will be the 1.1250, before the palm annual 2018 at 1.1215, to be considered as a major support, reinforced by the proximity of the psychological level of 1.12.