The multi-session recovery in the EUR / USD pair once again encountered a solid hurdle in the neighborhood of 1.19, prompting sellers to return to the markets and drag the spot back into the vicinity of the 1.18 mark in the second half of the week. There are additional pullbacks on the table, according to Pablo Piovano of FXStreet.
“The relentless advance of the pandemic and its impact on the growth prospects of the eurozone and the rest of the world is once again at the fore as the main driver of price action, while at the same time relegating the previous optimism that followed the news of vaccines. “
“New cracks are emerging in the Old Continent in response to possible vetoes from Hungary and Poland to the EU Recovery Fund of 1.8 billion euros. This issue is expected to be at the center of debate at the EU Council videoconference on Thursday and has the potential to rekindle political excitement among members and thus damage sentiment around the euro. “
“The corrective downside in EUR / USD could initially extend to last week’s lows in the 1.1750 region before the containment area near 1.1700, where the 100-day SMA and a Fibo retracement coincide 2017-2018 rally). The loss of this level could pave the way for a deeper retreat to the monthly lows around 1.16 the figure (November 4) ”.
“On the upside, 1.19 is still a tough nut to crack for the EUR bulls. If this level clears then attention should shift to monthly peaks around 1.1920 (Nov 9) before the August high at 1.1965 “.