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EURUSD: Euro buyers have another opportunity to resume the upward trend

Yesterday, the European currency fell in the morning after a weak report from the European Commission but returned a number of positions paired with the US dollar after news that China has sent its high-ranking trade representative to Washington to resume negotiations and discuss US demands.

As it became known yesterday, negotiations between the United States and China will begin. Let me remind you that this weekend, Donald Trump promised to introduce duties on Chinese goods, which will take effect this Friday. This promise angered Beijing, who had been thinking about leaving the negotiations for several days but yesterday announced the visit of Deputy Prime Minister Liu He to Washington. Negotiations will begin tomorrow.

It is reported that additional issues related to the negotiations were supplemented by US demands to include in the trade agreement a list of laws and regulations that would require the Chinese authorities to revise them, and make a number of changes for the economy.

As for yesterday's fundamental data, they were not of particular interest to traders. In the second half of the day, a report from Retail Economist and Goldman Sachs was released, according to which sales in US retailers decreased by 1.3% in the week from April 28 to May 4, compared to the previous week. The reduction was directly related to the decrease in the activity of buyers after Easter. For the week ending May 4th, sales increased by 2.6% compared to the same period last year.

A good sign for the economy was the growth of consumer lending in the United States. Despite the fact that lending grew at a slower pace in March, demand for loans remains quite high, which will stimulate retail sales in the future.

According to the Federal Reserve, consumer lending in March 2019 increased by 3.05% per annum and amounted to $10.28 billion compared with February. Economists had expected credit growth of $15.85 billion in March compared to the previous month. Non-renewable loans showed an annual growth of 5.01%.

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The speech of Fed Vice-Chairman Richard Clarida also left the market unattended. The Fed representative once again reiterated that the US economy is in good shape, as evidenced by recent US GDP growth in the 1st quarter of this year, which was quite strong. Clarida also noted that inflation has been weak recently, but this is a temporary factor. According to the Vice-Chairman, the monetary policy is conducted well, and there is no good reason to raise or lower rates.

As for the technical picture of the EURUSD pair, it continues to be the same as at the beginning of this week. Further prospects for the movement of the trading instrument seem vague. Bears can prove themselves after the return and update of the resistance level of 1.1215, while the bulls will be clearly set to hold large support of 1.1170, from which an attempt has already been made to build the lower boundary of the new upward channel. The target of buyers is the breakdown and consolidation above 1.1215, which will open a direct road in the area of last week's highs 1.1260 and 1.1290.

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