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The positive effect of Donald Trump’s election on the US Dollar remains relevant, while investors expect his policies, particularly in terms of foreign trade, to support the greenback, while weakening the Euro.
Remember that Trump plans universal customs duties of 10 to 20%, which could significantly reduce European exports to the USA and affect the Euro.
Furthermore, investors fear that Trump’s policies will stimulate inflation, with the result that the Fed would be forced to lower rates less (or less quickly) than expected, which would be a powerful upward factor for the note. Green.
Note, however, that the economic calendar could play a more important role in the evolution of the EUR/USD from today, while data from the German CPI and ZEW index are expected, before the US inflation data for October tomorrow.
From a chart perspective, the next potential support for EUR/USD is this year’s low at 1.06, while on the upside, it is the 1.07 area that is the first concrete obstacle on the chart daily.
Note also that the 50-day moving average is quickly approaching the 100-day moving average. However, a crossing of the 50-day MA below the 200-day MA would constitute an important bearish signal which could motivate new sellers.
