EUR/USD retests 1.19 as Europe punts Astrazeneca decision to Thursday

Europe is at least a month or two behind the US and UK in vaccinating its population...

EU (1)

Stated simply, the European Medicines Association is stuck between a rock and a hard place: COVID cases are rising throughout the continent, but the much-needed AstraZeneca vaccine has been called into question over a couple of reported cases of dangerous blood clots. With many countries across Europe already struggling to overcome logistical hurdles and vaccine skepticism among the populace, the concerns about vaccine side effects are the last thing the continent needs.

This morning, the European Medicines Association delayed its scheduled decision on whether to ban the AstraZeneca vaccine to Thursday as it evaluates the blood clots on a case-by-case basis. Reading the tea leaves, the group appears to be leaning against an outright ban, with various representatives stating that there is “no evidence” linking the blood clots to the vaccine, that side effects have occurred at a rate “no higher than the number seen in the general population,” that the “vaccine’s benefits continue to outweigh its risks,” and that any changes to current recommendations are “unlikely.”

With the market hyper-focused on the timelines for economic recoveries, Europe is at least a month or two behind the US and UK in vaccinating its population, which means it’s likely a couple months behind on reopening its economy fully. The lack of buy-in for additional fiscal stimulus, unlike we’ve seen in the US this week, could further delay a full economic recovery on the continent.

EUR/USD technical analysis

In any event, the euro is the worst-performing major currency on the day, with the delayed vaccine decision playing a major role in the move. The world’s most widely-traded currency pair broke down to a nearly 1-week low below 1.1910, triggering a number of short-term stop sell orders and driving EUR/USD below 1.1900 as of writing.

Source: TradingView, StoneX

Moving forward, the pair’s near-term technical bias will remain to the downside as long as rates hold below 1.1910, and more broadly, it would take a move back above 1.2000 to convince bulls that the longer-term uptrend has resumed. To the downside, bears may look to target the year-to-date low at 1.1835 next.

Learn more about forex trading opportunities.


More from Forex

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.