Market fundamentals make investors more cautious with a focused focus on US economic stimulus packages affecting global financial markets.
House Speaker Nancy Pelosi and US Treasury Secretary Steven Mnuchin continue to discuss the Coronavirus assistance package. However, it is less pleasant for investors when Republicans and Democrats still do not understand each other, but say they are still optimistic to reach a negotiated agreement.
Since yesterday, the US dollar movement has given less clear indications to the development of the stimulus package as well as mixed US economic data.
The US dollar will strengthen with risk sentiment over concerns over US stimulus packages, but investors are likely to be wary of US NFP job data reports to be published in the New York session.
The price movement on the EUR / USD chart yesterday was seen volatile in the range of around 50 pips from the level of 1.17200 with the level of 1.17700.
The movement of price volatility is influenced by investor reactions to the US stimulus package discussion which is seen as a ‘pull-rope’. With no truly convincing results, investors will remain vigilant.
If you look at the price movement on the 1 hour time frame on the EUR / USD chart, the price is still moving above the Moving Average 50 (MA50) support level.
However, continuing at the beginning of the Asian session on Friday, the price is seen to begin to fall below the support level and will give an early signal of a bearish trend change.
A decline above the 1.17200 level is seen to be pushed to a lower level to the weekly support zone around 1.16800 before a lower decline will lead to the 1.16100 support zone.
On the other hand, if the US dollar moves weakly over the weekend, the price is expected to rise to a concentration level around 1.18000.
Monitor current market sentiment as well as NFP employment data reports that will be the focus of the New York session shortly.
