The dollar scored a few punches against its major counterparts today.
The ECB is up though! Word around the hood is that Governor Lagarde and her crew are about to make stimulus rain today.
Will it extend EUR/USD’s uptrend this week?
Before we check out the chart, read the major headlines that influenced price action during the Asian session!
Fresh Market Headlines & Economic Data:
- Bank of Canada maintains target for the overnight rate, scales back some market operations as financial conditions improve
- U.S. factory orders extend decline in April
- Fed expands municipal liquidity program to include transit, airports, utilities
- Australian retailers suffer record sales slump, backs grim outlook for Q2 2020 GDP
- Australia’s trade surplus eases in April
- Australia launches $470 million stimulus package for construction sector
- U.S. to impose restrictions on additional Chinese media outlets
- German coalition parties agree 130 billion EUR stimulus package
Upcoming Potential Catalysts on the Economic Calendar:
- Switzerland’s CPI at 6:30 am GMT
- U.K.’s construction PMI at 8:30 am GMT
- Eurozone retail sales at 9:00 am GMT
- U.S. Challenger job cuts at 11:30 am GMT
- ECB’s policy decision at 11:45 am GMT
What to Watch: EUR/USD
As you can see, EUR/USD has been on a happy uptrend since last week. Specifically, a rising trend line has been supporting the euro since May 25.
Can today’s events extend the uptrend?The European Central Bank (ECB) is expected to share its monetary policy decisions for the month of June and the word around is that Governor Lagarde and her team will announce a sizable pandemic-related stimulus program (PEPP). This comes after Germany added 130B EUR to its own stimulus efforts through 2021.
Don’t discount the dollar just yet! Today’s weekly unemployment claims report could inspire risk aversion if it hints at a much weaker NFP number tomorrow. Ditto for any updates suggesting increased tensions between the U.S. and China.
If the euro ends up breaking below the trend line, however, then EUR/USD could revisit areas of interest closer to 1.1175 and 1.1150.