Daily Price Outlook
The EUR/USD pair achieved an intraday high of 1.1345 and is holding close to that level as the Asian trading session begins. Despite a negative market mood and increased US government bond yields, the shared currency recovered against the greenback. The US dollar is falling across the board, though the losses are unequal. The EUR and AUD are the top-performing currencies, while the GBP is the worst.
Speculative interest is not focused on US government bond yields, which have reached new weekly highs. Concerns about inflation may have been eclipsed in part by US Federal Reserve Chair Jerome Powell's statement that policymakers would examine speeding up tapering at their December meeting. Meanwhile, the 10-year Treasury note yield is 1.52 percent, and US indexes are neutral, remaining close to their opening levels.
The EU did not provide any important macroeconomic data, however, the US announced MBA Mortgage Applications for the week ending December 3, up 2% from the previous month. The country also released the October JOLTS Job Openings report, which revealed that job openings grew to 11.0 million on the last business day of October, while hires remained stable at 6.5 million and total separations fell to 5.9 million. Germany will announce the October Trade Balance on Thursday, while the United States will post Initial Jobless Claims for the week ending December 3.
European stock markets fell Friday, reversing some of the week's gains as investors assessed the implications of the Omicron Covid variant and dismal UK GDP figures before critical US inflation data release. At 3:40 a.m. ET (0840 GMT), the DAX in Germany was down 0.4 percent, the CAC 40 in France was down 0.5 percent, and the FTSE 100 in the United Kingdom was down 0.2 percent.
According to data released earlier Friday, the United Kingdom's economy barely grew in October, even before the introduction of the Omicron coronavirus type. Gross domestic product increased by only 0.1 percent, falling short of the predicted 0.4 percent increase and decreasing considerably from monthly growth of 0.6 percent in September.
This meant that the economy remained 0.5 percent smaller than it was in February 2020, shortly before the initial Covid-19 lockdown, and additional improvements are expected to be difficult to achieve given the current restrictions imposed to combat the virus. The figures did little to affect the market's conviction that the recent spread of Omicron will delay the Bank of England's rate hike until the new year.
The main European indices, along with most global stock markets, have gained ground this week, aided by research indicating that the Omicron variant of the Covid-19 virus causes less severe reactions in patients than prior versions. Incorporate news, Daimler (OTC:DDAIF) Truck shares traded on the Frankfurt Stock Exchange for the first time on Friday, at 28 euros per share, following the commercial vehicle maker's separation.
EUR/USD Intraday Technical Levels
Pivot Point: 1.1305
EUR/USD - Technical Outlook
The EUR/USD is trading at 1.1280 having dropped below the pivot point support level of 1.1305 level. Closing of candles under this level supports a selling bias in the EUR/USD. On the downside, the EUR/USD pair is heading lower towards 1.1265 support. The next support levels prevail at 1.1283 and 1.1198 levels.
On the other hand, the breakout of the 1.1305 level exposes the EUR/USD towards 1.1332 and the 1.1375 level. The RSI is holding in a selling zone, therefore, the bearish correction dominates below the 1.1305 level. All the best!
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