EUR/USD: Slight startle to the upside in the face of the IFO, but the bottom profile remains negative


© Reuters. EUR/USD edged up in the face of the IFO

Investing.com – The pair EUR/USD enjoys this morning’s IFO index of business climate in German stronger than expected, appearing to 99.6 points against 98.5 in advance and 98.5 previously.

This has now led to the Euro-Dollar on top of a daily on the 1.1320, but it will take more than that to add a new profile to the upside in the pair.

The last week has been particularly hectic for the pair EUR/USD.

Recall that the EUR/USD rose strongly last Wednesday, in front of a meeting of the Fed more dovish than expected, where the us Federal Reserve has warned that it was more likely that no rate increase this year at this stage.

However, after an initial reaction to the upside on Wednesday evening, EUR/USD had spent the day Thursday to reverse the gains of the previous day.

The motion correction has deepened Friday with the help of european PMI very disappointing as the manufacturing PMI of Germany for the month of march having, for example, displayed a fall surprise, the lowest since almost 7 years.

On Monday morning, the trend therefore remains overall bearish in the short term, with no signal to bet on a rebound in the immediate future, despite the slight blip upward in the face of the IFO.

Today, it should be noted that the records of the Brexit, and the trade war China-USA will need to be monitored closely in view of new information influential.

About the trade war China-USA, we will remain this week to pay attention to the coming to China of the Trade representative US Lightizer and the Secretary of the Treasury Mnuchin for discussions with Liu He, vice-premier of the chinese.

About the Brexit, the most important question in the short term will be whether May will be able to validate the agreement concluded with the EU by the Parliament of the UK, or if it will be necessary to consider other options for Brexit, some observers do not exclude the possibility of a new referendum.

Anyway, in regards to EUR/USD, we keep in mind that the violent movements on the GBP/USD in the link with the info about the Brexit are usually also visible on EUR/USD because of the correlation between the two pairs.

From a graphical point of view, it should be noted that in case of continuation of the rebound initiated by the IOF, the first resistance is located at 1.1335, which is also moving average 200 hours, before 1.1350, 1.1390-1.1410, and 1.1450.

Has the decline, the psychological threshold of 1.13 will be the first medium potential to monitor, before 1.1270-75 (low of last Friday), and then 1.1250, 1.12 and 1.1175.

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