Euro falters over renewed concerns about weak economic growth
The euro moved sharply lower against the US dollar this week after European PMI Manufacturing data showed continued weakness inside the eurozone manufacturing sector. The EURUSD pair had spent much of the trading week in a narrow range before tumbling lower on the weaker than expected German and EU Manufacturing figures for the month of April. The worse than expected data continued to highlight that many European economies are close to entering technical recessions, and also that the European Central Bank may soon need to enforce additional policy measures to help the struggling EU economy.
- The EURUSD pair is bearish while trading below the 1.1250 level, key support is found at the 1.1216 and 1.1175 levels.
- If the EURUSD pair trades above the 1.1250 level, buyers may test towards the 1.1290 and 1.1330 resistance levels.
The New Zealand dollar came under pressure against a basket of currencies this week after the New Zealand economy released much weaker than expected inflation data. First fiscal quarter Consumer Price Index inflation data for the New Zealand economy came in much softer than expectations. The New Zealand dollar tumbled lower on the weak dat aas expectations of an interest rate cut from the Reserve Bank of New Zealand have now increased. The RBNZ has also recently started to turn more dovish towards interest rates, as the weakening global economy hurts domestic growth prospects inside the New Zealand economy.
- The NZDUSD pair is only bearish while trading below the 0.6740 level, key support is found at the 0.6660 and 0.6610 levels.
- If the NZDUSD pair trades above the 0.6740 level, key resistance is found at the 0.6790 and 0.6880 levels.
RBA bearish tilt
The release of the Reserve Bank of Australia meeting minutes outlined the conditions that Australian policymakers would need to see before they embarked on cutting interest rates this year. The meeting minutes noted that the RBA would need to see unemployment rising and inflation continuing to underperform for them to start to consider cut interest rates in 2019. The Australian dollar failed to react to the bearish commentary from the RBA, with the AUDUSD pair moving higher on better than expected Chinese data and solid Australian monthly jobs figures, which showed monthly employment increasing more than expected.
- The AUDUSD pair is only bullish while trading above the 0.7140 level, key resistance is found at the 0.7210 and 0.7245 levels.
- If the AUDUSD pair trades below the 0.7140 level, sellers may test towards the 0.7100 and 0.7020 support levels.
Bitcoin holds support
Bitcoin found strong technical support from just above the $5,000 level this week as the number one cryptocurrency by market capitalization edged back towards its current 2019 trading high. Bitcoin had come under heavy selling pressure towards the end of last week, as the BTCUSD pair reversed sharply lower from just below the $5,500 resistance level. The broader digital currency market also stabilized after the recent sell-off, with Litecoin and Ethereum both holding key technical support and moving higher alongside Bitcoin.
- The BTCUSD pair is only bearish while trading below the $5,100 level, key support is found at the $4,900 and $4,700 levels.
- If the BTCUSD pair trades above the $5,100 level, buyers may test towards the $5,300 and $5,454 resistance levels.