EUR/USD recap for 20.07.2017
As mentioned in the previous post, the pair had an upcoming potential to test 1.16231 and try another attempt to reach and breach 1.17214. The boost for the Euro came in from several events that occurred:
- ECB Press Conference
- EURO Bid Rate
- Unemployment Claims
- Muller's words of expanding probe into Trump business transactions
Draghi delivered dovish words to the Euro fanatics and yet the EU currency managed to slip away from the bear grip and climb. More boost came in from the stronger Claims coming in at 233K vs 245K estimated. ECB leaving rates unchanged, The final blow to the USD came in with the news about the expanding of the investigation against Donald Trump about his business transactions and ties with Russia, which are still shrouded in speculation. Bloomberg reported that the special council is examining the dealings of Trump, Kushner and Manafort.
In an Bloomberg TV interview, the reporter called it "a very dramatic expansions of the probe" and said it creates "great legal jeopardy" for the President. The report says Muller is "examining a broad range of transactions involving Trump's businesses".
The timing of the report is amazing given that just two days ago Trump told the New York Times that any digging into matters beyond Russia would be out of bounds. He also expressed displeasure with Sessions, who was forced to say yesterday that he didn't plan to resign.
"Sessions should have never recused himself, and if he was going to recuse himself, he should have told me before the took the job and I would have picked somebody else", Trump said.
The special prosecutor is looking into purchases of apartments in Trump buildings, real estate investments, the Miss Universe pageant and Trump's sale of a Florida mansion to a Russian oligarch.
Bank of Cyprus has also been pulled into the probe. His team has issued subpoenas to foreign banks.
The Dollar was hammered as every bit of news came in with the catalyst events. Thus the way to 1.16 and beyond was cleared and the pair went for a 23 - month high.
A classic turn - out for EUR/USD pair would be if the range is broken after the long downtrend, giving the push needed for a new uptrend towards 1.20 and even beyond that. If weakening dollar catalysts remain in place, we might see the euro climbing back quickly to its former glory.
Long positions (buying the dips) are a recommendation for the current situation that is unfolding.