Concerns Over Further Declines in the U.S. Dollar Against the Euro?

Concerns Over Further Declines in the U.S. Dollar Against the Euro?

27.04.2023

In yesterday’s U.S. currency trading, the U.S. dollar fell against the euro after the U.S. MBA Mortgage Applications Index, released yesterday, rose to 3.7% from the previous reading of -8.8%. The EUR/USD pair rose from 1.0968 to 1.1094. The rebound was supported by the 75-period moving average (MA) on the 4-hour chart.On the daily chart, the EUR/USD pair continues to follow a solid uptrend along the 20-day moving average, and since no RSI divergence is observed, we should watch for further gains during European trading hours.

European currencies rose against the yen, led by the euro, which rebounded after Germany’s GfK Consumer Confidence Index—released yesterday—improved to -25.7 from -29.5 the previous month.The euro/yen pair rose from 146.454 to 147.881. It rebounded after touching the 75-period moving average (MA) on the 4-hour chart. The euro/yen is in the process of forming a triple top on the 4-hour chart, and the RSI is showing divergence. Therefore, traders should be wary of a pullback during U.S. trading hours.

Today’s schedule includes Turkey’s Economic Confidence Index at 4:00 p.m., the TCMB policy rate and statement at 8:00 p.m., U.S. initial jobless claims, U.S. first-quarter GDP, and U.S. personal consumption at 9:30 p.m.,U.S. Core PCE Deflator, at 11:00 PM U.S. Pending Home Sales, at 11:30 PM U.S. Weekly Natural Gas Inventories, at 12:00 AM U.S. Kansas City Fed Manufacturing Activity Index, and at 2:00 AM U.S. 7-Year Treasury Auction.We should remain cautious about the downside potential for the U.S. dollar, which has fallen against the euro.