Forex Signals: Pound, Euro to Extend Weekly Losses
Forex Signals: Pound, Euro to Extend Weekly Losses The pound and euro are set for a second-straight weekly decline against the dollar on Friday, as analysts' warn of further pain despite expectations that U.K and Eurozone economic output could improve this month.
GBP/USD fell 0.88% to $1.2118, a more than seven-week low, while EUR/USD was up 0.12% to $1.0817.
The impact of the coronavirus will likely continue to keep a lid on the pound and euro even as U.K. and eurozone purchasing managers' index surveys – set to be released next week - will likely recover in May, UniCredit suggested.
"There are still fears of a second wave of Covid-19 infections after new cluster cases were reported in Wuhan, China, and after new infections have also emerged in South Korea and Germany," the bank said.
Earlier this week, the U.K. reported GDP had declined 2% in the first quarter of the year, its quarterly biggest decline since 2008. The second reading of Eurozone GDP showed growth fell by a record 3.8% in the first quarter, with analysts warning of a deeper contraction in the second quarter.
"As the lockdowns had a far larger impact in terms of depth and time in 2Q than 1Q and the reopening of economies will happen just gradually, the decline in GDP will be far larger in the second quarter," ING said.
EURJPY Price: EUR vs JPY May Decline Further as Resistance Holds
EURJPY Price Analysis – May 15
An increase in the sellers’ pressure will push down the price towards the demand level of $113 which may further extend to $112 and $111 price level. In case the Bulls defend the demand level of $113, the buyers may take over the market and face the supply levels of $116, $117, and $118.
Supply levels: $116, $117, $118
Demand levels: $113, $112, $111
EURJPY Long-term Trend: Bearish
On the long-term outlook,EURJPY is bearish. The currency pair remains under the control of Bears’ pressure. Last week, there was no significant impulse in the EURJPY market. The price reached the supply level of $116 on 11 May. The buyers’ momentum became weak and could not push the price across the barrier at $116 price level. The bears’ pressure is weak and could not push down the price; this scenario resulted in consolidation at $116 – $115 level.