USD Weakness Sends EUR And GBP Soaring
While the House passed its version of tax bill Thursday, the U.S. dollar was little impressed and plunged during the Asian session amid low trading volumes.
The EUR/USD traded higher in the early European trading hours and we now focus on the 1.1850-barrier, which could prove crucial in terms of further bullish momentum. If the euro is able to stabilize above 1.1850, the next target is 1.1905. Sellers should, however, wait for a break below 1.1720 in order to sell euros towards 1.1670 and 1.1580.
Most attention will be paid to a speech of ECB President Mario Draghi today at 8:30 UTC, which could affect the euro’s price action.
The British pound soared on new Brexit optimism. After the U.K. has shown a “willingness to conclude a positive outcome” according to German MEP Manfred Weber, the EU is growing more confident that the current Brexit impasse will be broken and that exit talks will progress. While there might be some room for further gains in the GBP/USD, we bear in mind that as long the pair remains range-bound between 1.3340 and 1.30 there is no directional bias.
We wish you a nice weekend.
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