The euro today rallied higher against the US dollar boosted by positive investor sentiment towards the single currency. The lack of any significant data from the Eurozone economic docket means that the single currency’s rally was not triggered by any fundamental drivers.
The EUR/USD currency pair today rallied by about 45 points from a daily low of 1.1854 to hit a high of 1.1899, but could not overcome the crucial 1.1900 resistance level.
Given that European markets reopened today after a long four-day Christmas holiday, the euro staged a recovery from lows hit last week Friday. The EUR/USD currency pair recovered from Friday’s lows hit after the results of the Catalan elections indicated that pro-independence parties had won. Investors had fled the single currency due to the political risk associated with the Catalan independence movement, but they seem to have put aside their reservations today.
This week has three trading day’s before the New Year and it is highly likely that the currency pair will be range bound due to the absence of any major economic releases.
The currency pair’s short-term performance is likely to be affected by the release of the US Conference Board consumer confidence data and the pending home sales data scheduled for 15:00 GMT today.
The EUR/USD currency pair was trading at 1.1892 as at 12:53 GMT having rallied from a low of 1.1854. The EUR/JPY currency pair was trading at 134.63 having rallied from a low of 134.18.
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