The sentiment around the common currency continues to deteriorate. In its fresh forecasts, the the European Commission revised lower its prospects of economic growth for 2019 in Germany and the region in general to 1.1% from 1.8% and to 1.3% from 1.9%, respectively. Moreover, the Commission now expects at 1.4% versus the previous estimate of 1.8%.
Against this backdrop and the latest disappointing macroeconomic data from the euro area, investors push back the ECB rate hike expectations further. If the itself starts signaling a possible shift in its forward guidance, the prospects of shelving plans to hike rates in 2019 will hurt the euro quite dramatically.
Technically, EURUSD needs to stay above the 200-week MA that is standing on the way to the 1.290 region, where January 24 lows lie. Should the 1.13 support withstand the pressure from the dollar bulls, the common currency could make some recovery attempts. However, the fundamental picture in the region coupled with trade war worries will prevent the high-yielding currency from a decent rebound in the short term.
This does not mean that I predict anything or that I hope or wish for EURUSD to fall. Why? Cuz my methodology does not rely on emotions or predictions. I'm equally happy if EURUSD rockets north (for whatever reason).