EUR: The US-China trade negotiations will take place this week. The fall of the euro slows down

Despite the continued strengthening of the US dollar, which has been observed for 11 days in a row, traders and investors have long ago revised their portfolios and will adjust them according to new directions in the US monetary policy. This year's rate hikes are clearly not expected, the maximum can be counted on one thing, which weakens the position of the US dollar in the medium term.

The only hope for further short-term growth of the dollar is the meeting of high-ranking representatives of China and the United States scheduled for February 14-15 in Beijing. A meeting was directed to the resumption of negotiations in order to resolve the trade conflict between the two countries before March 1, when an armistice in a trade war should end.

The meeting will be held between Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer, and Finance Minister Steven Mnuchin.

The data, which came out on Friday on the German economy, provided only temporary support for the euro, after a series of weak fundamental statistics observed throughout the past week.

According to a report by the Federal Bureau of Statistics, German exports rose, which could ease concerns about the slowdown in German GDP growth earlier this year.

According to the data, in December last year, compared with November, German exports increased by 1.5%, while imports increased only by 1.2%. Compared with December 2017, German exports decreased by 4.6%. Total surplus of German foreign trade in December amounted to 19.4 billion euros, while economists had expected its growth to only 18.5 billion euros.

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Already in the afternoon, the demand for the US dollar returned, and the statement by the Fed representative supported him.

San Francisco Fed President Mary Daly said in an interview that no recession in the US is expected, but the economy had to become more moderate after the hot 2018. She expects a modest impact of the suspension of government work on the economy in the 1st quarter of this year, after which recovery will follow in the 2nd quarter.

However, it is worth recalling that there is still a risk of a repeated shutdown, which increases the uncertainty and may hit consumers' confidence even more.

Daley also noted that the slowdown in the labor market is not surprising, given the rise in the Fed rates.

As for the technical picture of the EUR / USD currency pair, then, as noted at the end of last week, the demand for the US dollar slows down and an upward correction is brewing;

The sellers will target areas of support 1.1290 and 1.1270, from which a more powerful market reversal can begin.

The material has been provided by InstaForex Company - www.instaforex.com