On Tuesday, Republicans and Democrats failed to overcome their differences on what should be the spending on the next round of corona virus fiscal package.  According to the Associated Press, Republican plan totals about $1 trillion whereas Democrats have passed a $3 trillion package in the House. Meanwhile, House Speaker Nancy Pelosi said on Tuesday that the $1 trillion stimulus package proposed by the Republicans is not sufficient.

President Donald Trump encouraged Americans on Tuesday to wear a mask if they cannot maintain social distance from people around them as an effort to curb the spread of the corona virus. In his first briefing on the pandemic, He told reporters at the White House that the virus would probably get worse before it gets better, in one of his first recent acknowledgments of how bad the problem has become.

As corona virus cases are rising in all parts of the country including in politically important states such as Florida, Texas, and Arizona, the president is shifting his tone to try to get the number of cases under control as he fights for re-election against Democrat Joe Biden, who leads in opinion polls before of the Nov. 3 election.

Europe Union after five days of fraught discussions have agreed to create a €750 billion ($858 billion) recovery fund to rebuild EU economies ravaged by the corona virus crisis. The European Commission will borrow the money on financial markets and distribute just under half of it — €390 billion euros ($446 billion) — as grants to the hardest-hit EU states, with the rest, provided as loans. Leaders also agreed on a new EU budget of nearly €1.1 trillion ($1.3 trillion) for 2021-2027, creating combined spending power of about €1.8 trillion ($2 trillion).

EUR/USD 4 Hour Chart:

Support: 1.1454 (S1), 1.1380 (S2), 1.1337 (S3).

Resistance: 1.1571 (R1), 1.1613 (R2), 1.1688 (R3).

The US fiscal wrangling created an unpleasant impact on impact whereas the EU fiscal package seems to impact Euro favourably. We expect a bullish trend for EUR/USD.