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On Monday the 20th of March, trading on the euro closed slightly up. A tall upper shadow has formed on the daily candlestick. The exchange rate fell yesterday from a maximum of 1.0777 to 1.0725. What is strange is that the euro depreciated on the back of growth on the EUR/GBP cross and a slide in US bond yields. The low buyer activity seen is surely connected to the televised French presidential debate that took place last night. They’re important for the French, who look yet to decide on a favourite candidate.

According to a survey conducted by polling agency Elabe at the request of TV channel BFMTV, in which they asked which of the candidates was “the most convincing”, 29% of respondents went for Emmanuel Macron, 20% for Mélenchon, Le Pen and Fillon each got 19% and Hamon got 11%. Experts at the TV station judge Jean-Luc Mélenchon and François Fillon to be the frontrunners in the race.

US president Donald Trump gave a speech at a campaign rally last night, so it’s unclear whether the euro’s growth in Asia is a response to that, or a belated response to France’s televised presidential debate.

Market expectations:

On Monday, the euro closed at 1.0739, and in Asia rose to 1.0770. From a technical point of view, the daily and weekly timeframes of the EUR/USD and EUR/GBP pairs give us a mixed picture. It’s difficult to say whether or not the euro-bulls will be able to break the 1.0785 support. The current situation could play out in three different ways. First, a break at 1.0785. Second, a rebound from 1.0770. Third, consolidation over the next 2-3 days. In light of this, I haven’t tried to make a prediction on the hourly chart.

Day’s news (GMT+3):