Media reports stated yesterday that president Trump instructed US trade officials for tariffs on additional $100 Billion Chinese imports. The additional tariffs were considered “in light of China’s unfair retaliation” and cited as reasons that China has “repeatedly engaged in practices to unfairly obtain America’s intellectual property”. Chinese media rejected the threat as a ridiculous attempt of intimidation. Should there be further negative headlines about the issue we could see the USD weakening.
EUR/USD traded in a sideways manner with some bearish tones yesterday, testing the 1.2230 support line. We see the case for the pair to continue to trade in that manner however please be advised that the pair may be very sensitive to the US Employment Report data due out today. On the technical side, the pair continues to trade in a sideways motion, within the boundaries set on the 19th of January and is testing the upward trend-line intercepted since 10th of April last year. Should the pair come under selling interest we could see it breaking the 1.2230 support line as well as the aforementioned upward trend-line and aim if not breaching the 1.2100 support level. Should it come under buying interest we could see it aiming for the 1.2355 resistance line and even breaching it.