Will the Rise of the Euro Against the Dollar Pause?
25.08.2021
- U.S. MBA Mortgage Applications Index
- U.S. 5-Year Treasury Auction
Yesterday, the three major U.S. stock indices all rose, creating a “risk-on” market characterized by higher stock prices, higher interest rates, and higher crude oil prices. The yield on the 10-year U.S. Treasury note rose slightly to 1.29%, just shy of 1.3%, while WTI crude oil prices recovered to $67.3.U.S. existing home sales for July, released yesterday, came in at 708,000 units, exceeding the market forecast of 697,000 units and signaling resilient demand in the housing market.
In the foreign exchange market, the Dollar Index has fallen for two consecutive days, dropping to 92.8. As a result, the euro/dollar pair has risen slightly. The euro/dollar is currently trading around 1.174.From a technical perspective, the EUR/USD pair appears to be finding support at the 200-period simple moving average (SMA) on the hourly chart, and on the 4-hour chart, it is also finding support at the 20-period moving average (MA). While the outlook depends on the U.S. dollar, the key focus will be whether the pair can break above its recent high of 1.180.
Today’s economic indicators include the Turkish Economic Sentiment Index and Capacity Utilization Rate at 16:00 European time, the GermanIFO Business Climate Index at 17:00, the U.S. MBA Mortgage Applications Index at 20:00, U.S. Durable Goods Orders at 21:30 U.S. time, U.S. Weekly Crude Oil Inventories at 23:30, and the U.S. 5-Year Treasury Auction at 26:00.With the Jackson Hole Symposium just two days away and volatility across various currencies on the decline, we will carefully assess how today’s economic indicators affect currency strength and weakness.
Author: Keisuke Sakurai
