European stocks slipped on Wednesday, failing to draw strength from a record run for Wall Street’s S&P 500, as investors feared a resurgence in corona-virus cases could affect the economic recovery in the continent.

Eurozone governments will consider shutting down parts of the economy again to control what is increasingly looking like a second wave of the virus, and how this will influence policy at the European Central Bank. But even if a full-blown second outbreak can be avoided, there’s a high risk the recovery stalls over the coming months amid the realization that there’s a limit to how far business life can return to normal during a global pandemic. A stronger exchange rate could also create headaches for the euro bloc as it would make exports more expensive, further straining the recovery.

“The EU released its June Current Account on Wednesday, which came in at €20.69 B better than the previous €7.95 B. The Union also published July inflation, with the monthly CPI down to -0.4% from 0.3% in the previous month. The annual figure, however, came in as expected at 0.4%, while the core annual CPI hit 1.2%, as expected.”

On the Other hand, the FOMC July meeting’s minutes supported the dollar. The document was quite similar to the one of the previous meeting, although it added an encouraging line, as policymakers said that economic activity and employment have picked up somewhat in recent months, nothing that anyway remain well below their pre-pandemic levels. The document gave the greenback another lift against its major rivals.

Apple and other well-established tech giants such as Microsoft, Google, Amazon, Facebook, and Netflix have thrived during the upheaval as the pandemic has forced millions of people to work, attend classes, shop, and entertain themselves at home. Apple’s stock has climbed nearly 60 percent this year. In recent weeks, the rally has been bolstered by excitement over a four-for-one stock split that Apple announced late last month in an effort to make its shares more affordable to a wider swath of investors.

EUR/USD 4 Hour Chart:

Support: 1.1793 (S1), 1.1750 (S2), 1.1671 (S3).

Resistance: 1.1915 (R1), 1.1995 (R2), 1.2037 (R3).

These catalysts drive Dollar stronger than Euro. The focus of the investors now shifts towards the US Jobless Claims, Philly Fed Manufacturing Survey, and the European Central Bank (ECB) policy meeting’s minutes due later today for fresh trading directives. We expect a bearish trend for EUR/USD.