The EURUSD is trading lower after Spain recorded a spike in its coronavirus daily infection numbers. Spain’s health ministry presented data on Thursday, which showed that there were 1,229 new coronavirus infections, representing the highest daily increase since the end of the lockdown on June 21st. This number was surpassed on Friday as the number of confirmed cases in the country climbed to 1,525. This is the 3rd straight daily increase of more than 1000 cases.
Reuters is also quoting ministry sources as saying that the total number of cases, including laboratory tested individuals who may have recovered, rose from 285,430 to 288,522.
Consequently, Germany has issued a travel warning for the Catalonia and Aragon regions via its foreign ministry.
Expectedly, this has provided an opportunity for a long-expected pullback on the EURUSD pair, allowing it to trade off weekly highs at 1.18006. The pair is down 0.39% on the day in what could be the second losing day in 11.
Technical Outlook for EURUSD
The pair has had a stellar run which appears to have temporarily run out of steam as bulls respect the 1.1800 psychological support line. The highs of May to October 2018 on the weekly chart constitute the technical resistance at 1.18008. The next resistance comes in at 1.19472 in the medium-term. The EURUSD needs to breach 1.18008 to open the pathway towards the next resistance. The high on August 28th 2017 constitutes a further resistance at 1.20560.
On the flip side, rejection at the current resistance could set off some profit-taking, which may send the pair towards 1.15916, which is the 23.6% Fibonacci retracement from the low of March 16th to the swing high represented by this week’s high.
EURUSD Weekly Chart