EUR/USD: flat on Friday, suffers worst week since January
The EUR/USD pair recovered ground during the USD session and erased daily losses. Still remains more than 150 pips below where it was a week ago.
The greenback weakened on Friday despite better-than-expected US data. The first estimate for Q1 GDP growth came in at 2.3% above the 2.0% expected. The US Dollar peaked after the report and then pulled back.
EUR/USD bottomed at 1.2054, the lowest since January 12. From the lows rebounded and it was about to end the week moving in a range between 1.2115 and 1.2110, suffering the worst weekly loss since January. A stronger US dollar and the tone around the euro after the ECB meeting weakened the pair. Also some technical factors could have played a role.
Next week, GDP figures from the Eurozone are due on Wednesday. Growth is expected to have slow in Q1 from 0.7% to 0.4%. Another relevant report will be on Thursday with inflating data. In the US will be a busy week that includes the FOMC meeting (Fed’s decision on Wednesday) and the Non-farm payroll report on Friday.
During the week, EUR/USD broke a monthly range and accelerated to the downside, breaking an uptrend line and falling below the 20-week moving average since December. The decline has been significant, so a period of consolidation could be seen before another move.
To the downside, support might be seen around the 1.2030 area before 1.1950. On the flip side, 1.2150 and the 1.2200 could be strong resistance areas.