The euro has a slight advantage against the dollar

EURUSD chart analysis

During Asian trade, the euro consolidated gains against the dollar. It is currently pair at $ 1.13575, which represents a weakening of the common European currency by 0.08% since the start of trading tonight. The address of the chairman of the Federal Reserve, Jerome Powell, before the US Congress showed a less “hawkish” tone than expected.

Germany today reported 80,430 new coronavirus infections, the highest number registered in a day since the pandemic began. The previous daily record was 76,000 cases on November 26, Reuters reports. The number of infected in Germany now stands at 7,661,811, while the number of deaths from covid has risen by 384 to 114,735. Just under 75 percent of the population has received at least one dose of the covid-19 vaccine, according to the latest data from the Robert Koch Institute for Infectious Diseases.

In Austria, a new daily record of corona-infected viruses has been set, which has almost tripled in a short time. In the last 24 hours, 17,006 newly infected coronaviruses were reported.

The daily number of new cases of covid-19 in Hungary today jumped to 7,883 from 5,270 reported a week earlier. Still, the number of patients treated at the hospital fell during the week, the Hungarian government said. The government said the new omicron strain caused 29 percent of new infections, but some private laboratories reported much higher numbers, Reuters reports.

France reported 368,149 new coronavirus cases on Tuesday, the largest one-day pandemic.

Pair EURUSD is still in consolidation, there are no major jumps on the chart so far, and everything is in the range of 1.13000-1.140000.

Bullish scenario:

• Pair has made a break above the MA20 and MA50 moving averages, and now we need further positive consolidation that would push us to 1.14000.
• Our main goal is to get to the top trend line at 1.15000 and try to make a break above it.
• If that happens, we will have space up to 1.17000, the place of the previous high from October.
• An additional resistance at that level is the MA200 moving average.

Bearish scenario:

• We need a negative consolidation and withdrawal of the EURUSD pair below 1.13000.
• After that, we are again below the MA20 and MA50 moving averages, strengthening the bearish pressure on the pair.
• In the following, we go down to the previous support in the zone around 1.12000.

Market overview

The EURUSD pair continues to monitor the dollar’s performance, as well as policy differences between the ECB and the Federal Reserve and the response to persistently rising inflation on both sides of the ocean. On the other front, the continued progress of the coronavirus pandemic remains an exclusive factor to be viewed when it comes to the prospects for economic growth and investor morale. Later in the calendar, industrial production in Europe will be the only announcement. At the same time, the data from the US on inflation for the month of December will attract all the attention across the Atlantic later in the session.

Villeroy from the ECB stated that we are very close to the peak of inflation and that the ECB will do everything necessary to achieve 2% inflation.