EUR/USD has recovered sharply back into positive territory on the day. Triggering the abrupt recent injection of risk appetite into markets in recent trade was the news that US fiscal stimulus talks are back on; Democratic Minority Leader of the Senate Chuck Schumer said that Republican Senate Majority Mitch McConnell had agreed to resume negotiations on another Covid-19 aid package. Meanwhile, Senate and House leaders are reportedly scheduled to meet today to discuss stimulus.

Moving ahead, Thursday’s restart in US fiscal stimulus talks might have come at the perfect time for a market that was just showing signs of starting to really get worried about the worsening state of the Covid-19 pandemic. Of course, there is no guarantee that there will actually be a deal; the Democrats still want a big package ($2T plus), while the Republicans have maintained they want something smaller and more targeted ($500B). But with the election in the rear mirror, perhaps a compromise will be more palatable to both sides. Any progress towards a deal will of course continue to provide support for risk appetite and is likely to weigh further on USD, to the benefit of EUR/USD.

On the other hand, G-20 nations have deployed an unprecedented $11 trillion so far to accelerate an equitable and sustainable economic recovery from the corona virus crisis, according to a report released ahead of the G-20 leaders’ summit in Saudi Arabia this week. 

The European Union wants to increase its offshore wind capacity from 12 to 300 gigawatts (GW) by 2050, according to new plans laid out on Thursday. The “Offshore Renewable Energy Strategy” from the European Commission, the EU’s executive arm, will also aim for 40 GW of ocean energy such as tidal and wave power within the same time frame.

The greenback showed little reaction after the Labor Department reported that U.S. weekly jobless claims increased to a seasonally-adjusted 742,000 for the week ended Nov. 14. Economists polled by Reuters had forecast 707,000 applications for the latest week. It’s a relatively quiet day ahead on the economic calendar. German wholesale inflation and Eurozone consumer confidence figures are due out later today. Expect the consumer confidence figures for the Eurozone to have the greatest impact.

EUR/USD 4 Hour Chart:

Support: 1.1836 (S1), 1.1794 (S2), 1.1772 (S3).

Resistance: 1.1900 (R1), 1.1922 (R2), 1.1964 (R3).

Amidst all the catalysts favoring Euro against greenback, we expect a bullish trend for EUR/USD.