EUR/USD Bulls Still Not Out Of The Woods, Need At Least One Dose Of Optimism

The third question related to vaccines: European countries are finally receiving more doses of various jabs, but reports suggest that some are hesitating to take the AstraZeneca shots. Britain and the EU had an ugly row over supplies of this immunization solution and that has eroded confidence. Nevertheless, Astra’s vaccines are widely deployed in the UK and if the continent accepts these doses at a faster pace, the euro may rise.

In the US, the “deep freeze” storm in the southern US has slowed the distribution of COVID-19 vaccines, and bad weather is moving up north. If delays persist, it could weigh on sentiment. However, adverse weather affects only distribution and not production – and is unlikely to last.

All in all, there are reasons for optimism about the global economy and EUR/USD’s prospects to advance, but there is room for caution as well. 

EUR/USD Technical Analysis

(Click on image to enlarge)

Euro/dollar has topped the 100 Simple Moving Average on the four-hour chart but remains capped under the 100 and 200 SMAs. While downside momentum has eased, it has yet to turn positive. All in all, the picture is mixed.

Resistance awaits at 1.2110, which provided support last week and is also where the 50 SMA hits the price. It is followed by 1.2150, a swing high and then by 1.2170, the February top.

Some support awaits at 1.2080, the daily low, followed by 1.2055, which is a critical cushion and a separator of ranges. Further down, 1.2020 and 1.20 await EUR/USD.

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