Forex. EUR/USD trading forecast and signal for today, April 30
European currency declined against Dollar to the level of 1.2115. Forex pair EUR/USD remains under pressure and returns to the support level of 1.2100.
The quotes interrupted the growth of the previous two days and met with strong downward pressure, despite the initial rise to new monthly highs in the area of 1.2150. The decline comes amid growing consumer interest in the Dollar, which is supported by a strong jump in US yields. In fact, the US 10-year bond yield rose to a new two-week high of around 1.7%.
German data in April showed an increase in the number of applications for benefits by 9,000, while the unemployment rate remained unchanged at 6%. The final level of consumer confidence was -8.1 points, and did not change compared to the preliminary data. The German consumer price index rose to 0.7% in April from 0.5% in March. On an annualized basis, the indicator strengthened to 2% from 1.7%. The Harmonized Index of Consumer Prices (the European Central Bank's preferred measure of inflation) rose to 2.1%, compared with analysts ' estimate of 2%.
Despite a slight drop on Thursday, the US currency remains under pressure. The Fed notes improvements in the economy, but the foreign exchange market (FOREX) is more interested in signals about the beginning of monetary policy tightening. While the US regulator does not give such signals. This opens up opportunities for a further fall in the dollar. On the one hand, the Fed is extending the period of low interest rates and encouraging investors to increase the exchange rate hedging ratios for assets in the United States. On the other hand, the Fed's expectation comes amid the normalization of monetary policy around the world. In Norway, Canada, and even the UK, central banks are expressing growing confidence in the recovery and announcing plans to reduce stimulus. Against this background, further depreciation of USD looks quite likely.
Trading signals for EUR/USD
In the forecast, EUR/USD is expected to rise to the levels of 1.2140, 1.2160 and 1.2180.