Dollar weakens as mood remains cautious
EUR/USD => The currency rises towards 1.06
XPeng => The stock falls towards $23
XRP/USD => The crypto falls towards $0.41
EUR/USD rises ahead of German IFO sentiment data
EUR/USD rose 1.4% last week, boosted by broad-based USD weakness and growing expectations that the ECB will use the June meeting to prepare for a July interest rate hike.
The minutes of the latest ECB meeting had a more hawkish stance which was also supported by German wholesale inflation reaching a record high. High factory-gate inflation suggests that consumer prices are likely to rise further. Meanwhile, the USD fell amid fears of slowing growth as inflation remains persistently high and economic data was worse than expected.
Today the pair is rising as the selloff in the USD continues and as attention turns to German IFO business climate data, which s expected to worsen in May as businesses fret about rising pieces and stagflation. There is no high impacting US data today.
| Ger. PPI YoY April
Ger. IFO business climate |
Actual: 33.5% (2.6%)
Expected: 85.8 (1.1) |
Previous: 30.9%
Previous: 86.7 |
Where next for EUR/USD
EUR/USD rebounded off the 2022 low of 1.0350 and heads towards 1.06.
The recapturing of the 20 sma combined with the bullish MACD keeps buyers hopeful of further upside. Buyers need to retake resistance at 1.0650 the May high to continue the trend higher and to expose the 50 sma at 1.0770. On the flip side, sellers will be looking for a break below 1.0470 the April low to open the door to 1.0350 and create a new lower low.
XPeng Q1 earnings preview
The Chinese EV maker is due to report Q1 earnings today, with attendance expected to be focused on the extent of the impact of recent COVID lockdowns in China.
Consensus estimates point to a loss per share of $0.30, which would mark a 150% increase in QoQ and a 275% rise YoY. Revenue is expected to be $1.2 billion, an -11% decline QoQ and a 166% improvement year on year. However, with Q1 deliveries well ahead of forecasts, expectations are for a revenue beat.
The outlook will be watched closely, with Q2 guidance expected to be weak, which could fuel further volatility in the share price, which has halved over 2022.
Ripple treads water after snapping a five-week losing run
XRPUSD managed to gain 1% across last week, snapping a 5-week losing run, which saw the cryptocurrency lose around 35% of its value.
While Ripple has risen above $0.40, it remains firmly below $0.50, a level which is considered a crucial line in the sand that would support a positive change in sentiment. The current environment has proved to be challenging across the whole crypto space. However, XRP is likely to remain range-bound as investors await the SEC versus Ripple court ruling, which hangs in the balance. The lack of progress in the case remains a headwind for the crypto.
Support can be found at $0.40 (psychological level) and $0.39 (last week’s low).
Resistance for the pair can be seen at $0.44 (last week’s high) and 0.48 (20 sma).
