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Euro's reaction to the additional stimulus packaged was extremely positive. The European commission is planning to allocate 750 billion euros to support the virus-hit European economy. However, the optimism faded away very soon. The fact is that the previous plan of financial assistance was totally rejected due to dissatisfaction expressed by a number of European countries. The new plan may also follow this route. The proposal should be accepted by the EU countries. However, each of them has its own view on the current situation and on the sum that could allocated to help people. Nevertheless, a possibility of the plan implementation encourages traders and pushed the euro higher.
Of course, the current situation may change, if some European politicians decide to comment on the support measure. Their doubts may significantly influence the market mood. However, traders are mainly focused on the US statistics. Thus, according to the second estimate, the US GDP dropped by 4.8% in the first quarter. Notably, the restrictive measures were imposed only at the end of March. In other words, the recession could be the deepest since the Great Depression. At the same time, the labor market situation is getting worse. The number of the continuous unemployment claims may jump to 26, 180 thousand. The number of the first-time claims could exceed 2,120 thousand. The result is still ten times higher than the normal rise in the number of claims. Thus, forecasts are rather negative and the US dollar should lose in value. However, the EU politicians could mix up all the cards.
The number of the continuous unemployment claims (the US):
According to the technical analysis, the price consolidates above the psychological level of 1.1000, which also acts as a limit of the range of 1.0775//1.0885//1.1000. Market participants are still under pressure of the range. It is the first break of the range.
The main trend is downward.
It is quite possible that the pair will fluctuate between the levels of 1.0990/1.1040. Further movement of the pair depends on the levels of consolidation.
Thus, buy positions can be opened above 1.1040 with the target at 1.1080.
Sell positions can be opened below 1.0980 with the target at 1.0900.
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