28.04.2020: USD falls amid EU’s decision to loosen lockdown. Outlook for EUR/USD and GBP/USD

While the US authorities are still thinking over the sum of money that China should pay for the damages caused by the coronavirus, the European governments are announcing the lifting of containment measures. Notably, the US does not have any evidence of China’s guilt. At the same time, Austria has already announced that it will end its strict social lockdown on May 1st. Moreover, an obvious improvement of the epidemiological situation in Europe has boosted both the euro and the pound sterling.
Today, the macroeconomic calendar is almost empty. However, during the US trading session, traders will be focused on the US wholesale inventories data that may lead to further depreciation of the US dollar. According to the forecast, in March, the US wholesale inventories advanced by 1.0%. Amid a slump in consumer demand even such a small rise may reduce growth opportunities in the industrial sector. Thus, when the country’s economy will be recovering, the industrial production will still be dropping. In this case, the economic recovery may be even longer than analysts suppose. Of course, investors got extremely worried after such gloomy predictions
During the technical correction, the euro/dollar pair returned to the level of 1.0850. After that, it was trading around the limits of the range of 1.0815-1.0885. The same movement was recorded during the period from April 16-21.
It is quite possible that the quote may again try to test the resistance level of 1.0885. If the pair manages to break the mentioned level, it may move back to the level of 1.0815. Traders should remember that the market is in panic. Thus, the pair’s movement may fail to meet technical and fundamental analysis.
During our previous video review, we recommend to open buy positions above 1.0860 with the target at 1.0885. Today, it is better to initiate deals above 1.0910 with the targeted level at 1.0950.
Sell positions can be opened below 1.0810 with the target at 1.0775-1.0735. It is also possible to enter the market below 1.0700 with the target at 1.0636.
After a short-term stagnation, the pound/dollar pair managed to resume the upward trend and hit the level of 1.2500. It is quite possible that at the mentioned level, the pair may face pressure and slow down.
Buy positions can be opened above 1.2525 with the target at 1.2550-1.2570.
Sell positions can be opened below 1.2470 with the targeted level at 1.2420-1.2400.

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