Despite the ongoing saga with the debt-ceiling negotiations, USD gained during the previous week against EUR. Both economies are currently facing significant issues with fighting inflation and lower economic output. During the previous week GDP data for Germany, a largest economy among all EU member states and driver of economic growth within the EU, showed some stressed time for the German economy. Released GDP figure for Q1 this year of minus 0.5% shows that Germany is officially in technical recession, considering two consecutive drops in the economic output of the country. At the same time, consumer confidence continues to be in a negative territory, as GfK consumer Confidence for June posted a figure of minus 24. This means that Germans are not willing to spend their money on ordinary goods like clothes or new cars, which would probably drag the economy into continuous depressed economic output.
EURUSD started the previous week by testing the 1.08 support line and soon broke this level, by reaching 1.07, where the pair is ending the week. RSI reached level of 34, however, a clear oversold side is still pending, leaving some space for the pair to move to even lower grounds. Moving average of 50 days continues to diverge from MA200 counterpart, and continues to support the Golden cross which occurred in December last year.
EURUSD will start the week ahead by testing 1.07 level. As this is not a significant level for the pair, there is a higher probability for 1.08 resistance to be tested for one more time in the coming days. It should be taken into account that the week ahead would most probably bring some resolution of debt-ceiling negotiations, where some market reaction could be expected, still, at this moment there is low probability that 1.06 might be tested.
Important news to watch during the week ahead are:
Euro: Germany unemployment rate for May, Germany inflation rate for May, Euro Area inflation rate for May, ECB Monetary Policy Meeting Accounts,
USD: Debt-ceiling potential deal, CB Consumer Confidence for May, ISM Manufacturing PMI, Non-farm Payrolls, Unemployment rate.
EURUSD started the previous week by testing the 1.08 support line and soon broke this level, by reaching 1.07, where the pair is ending the week. RSI reached level of 34, however, a clear oversold side is still pending, leaving some space for the pair to move to even lower grounds. Moving average of 50 days continues to diverge from MA200 counterpart, and continues to support the Golden cross which occurred in December last year.
EURUSD will start the week ahead by testing 1.07 level. As this is not a significant level for the pair, there is a higher probability for 1.08 resistance to be tested for one more time in the coming days. It should be taken into account that the week ahead would most probably bring some resolution of debt-ceiling negotiations, where some market reaction could be expected, still, at this moment there is low probability that 1.06 might be tested.
Important news to watch during the week ahead are:
Euro: Germany unemployment rate for May, Germany inflation rate for May, Euro Area inflation rate for May, ECB Monetary Policy Meeting Accounts,
USD: Debt-ceiling potential deal, CB Consumer Confidence for May, ISM Manufacturing PMI, Non-farm Payrolls, Unemployment rate.
