Trade wars: Alliances forming?

Amid fears over a possible trade war, China seems to be reaching out for Europe as it pledges to open further it’s economy. Chinese officials recently stated that “China and EU, now have a common stance against unilateralism and upholding the World Trade Organization”. In other headlines, it seems to be the case that Germany is approaching France in an effort to overhaul EU relationships. Also, EU commission president Juncker stated that the bashing of Russia must stop, implying that a process for the normalization of the EU-Russian relationships could begin. Should there be any further positive headlines about the EU we could see the common currency strengthening.

EUR/USD traded in a sideways manner on Friday and during today’s Asian morning between the 1.1715 resistance level and the 1.1640 support line. The pair could continue to trade in sideways manner, however we might see some bullish tendencies as the financial releases today might favor the EUR and weaken the greenback. Should the pair come under buying interest we could see it breaking the 1.1715 resistance line and aiming for the 1.1820 resistance level. Should the pair come under selling interest we could see it breaking the 1.1640 support line and aim for the 1.1550 support hurdle.