5 Jan 2015
EUR recovers amid risk aversion in equities
FXStreet (Mumbai) - The EUR/USD pair recovered losses to trade comfortably above 1.19 levels as risk aversion in the equity markets across the US and Europe strengthens carry currencies like the EUR and the JPY.
Moreover, the single currency has shown signs of strength during the bouts of risk aversion since November 2014. The near zero interest rates in the Eurozone means the single currency is utilized as a carry currency by markets to invest in high yielding economies. Thus, unwinding of carry trades during risk aversion has helped the EUR/USD pair to take back its losses. Accordingly, the EUR/USD pair now trades 0.55% lower for the day at 1.1939, after having recovered from a low of 1.1887 hit after the release of the weaker German inflation data. On similar lines, the Yen too, has strengthened 0.84% to 119.49 per US dollar.
EUR/USD Technical Levels
The immediate resistance is seen at 1.1975, followed by a psychological resistance at 1.2 levels. On the other hand, support is seen at 1.1887 and 1.1858 levels.
Moreover, the single currency has shown signs of strength during the bouts of risk aversion since November 2014. The near zero interest rates in the Eurozone means the single currency is utilized as a carry currency by markets to invest in high yielding economies. Thus, unwinding of carry trades during risk aversion has helped the EUR/USD pair to take back its losses. Accordingly, the EUR/USD pair now trades 0.55% lower for the day at 1.1939, after having recovered from a low of 1.1887 hit after the release of the weaker German inflation data. On similar lines, the Yen too, has strengthened 0.84% to 119.49 per US dollar.
EUR/USD Technical Levels
The immediate resistance is seen at 1.1975, followed by a psychological resistance at 1.2 levels. On the other hand, support is seen at 1.1887 and 1.1858 levels.