The euro today rallied to new daily highs against the US dollar early in the European session driven by positive investor sentiment before giving up its gains later. The EUR/USD fell back at a critical resistance level as sellers stepped in, and the greenback staged a comeback clawing back its losses.
The EUR/USD currency pair today rallied from a low of 1.0809 to a high of 1.0888 before reversing and falling back to trade almost flat for the day and was trading sideways at the time of writing.
The currency pair rallied higher in the early European session as investors were hoping that many European countries would reopen their economies. The release of Spain’s upbeat unemployment report for Q1 by the National Institute of Statistics boosted the pair as the print came in at 14.41% versus the expected 15.6%. However, the rally peaked as it emerged that the easing of lockdown measures was going to be a gradual staggered process. France announced that it would reopen restaurants and schools on May 11, and Germany’s reopening suffered a setback in the form of higher infections.
The release of disappointing US goods trade balance report for March by the Census Bureau led to higher demand for the greenback as tracked by the US Dollar Index, which triggered the pair’s decline. The US recorded a $64.22 billion deficit as compared to the expected $-62.67 billion print.Â
The currency pair’s future performance is likely to be affected by tomorrow’s multiple European releases and COVID-19 updates.
The EUR/USD currency pair was trading at 1.0823 as at 20:40 GMT, having dropped from a high of 1.0888. The EUR/JPY currency pair was trading at 115.67 having fallen from a high of 116.27.
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