The European economy continues to show signs of recovery

March 24, 2021 15:00

Despite countries such as Germany and France impose new restrictions in the face of upcoming holidays and the problems in the vaccination rollout, macroeconomic data from today and during the last few weeks have been positive.

Last February, we commented on how German investor confidence increased, and this remains true with the most recent ZEW poll this week which had a better-than-expected result both in the current situation and in future expectations. In addition, good German GDP data showed an increase of 0.3% compared to the 0.1% expected in the fourth quarter, with the annual result being a decrease in GDP of 2.7% compared to the 2.9% expected.  

The good news was not limited to Germany, but we also received positive PMI data for all the countries in the eurozone, the United Kingdom, and the United States, which exceeded all expectations, from both the manufacturing and the service sectors.

Source: FXstreet Forex Calendar

 

Despite the positive data, the euro continues to lose ground against the dollar with a decline of 0.15% leading it to fight for its important level of support at the coinciding zone of its average of 200 red sessions and its previous lows represented by the red band after forming a small double top (in green) last week around its average of 18 black sessions

It is very important that we observe what happens at this level and see if the price is capable of forming a double bottom that could lead to a possible recovery since the loss of this level could open the doors to a further decline to its uptrend line.

Source: EURUSD daily chart from Admiral Markets MetaTrader 5 platform from December 16, 2019 to March 24, 2021. Taken on March 24 at 1:05 p.m. CET. Note: Past performance is not a reliable indicator of future results, or future performance.

Price evolution of the last 5 years: 

  • 2020 = + 8.93%
  • 2019 = -2.21%
  • 2018 = -4.47%
  • 2017 = + 14.09%
  • 2016 = -3.21%

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