The US dollar has been trading marginally lower against most counterparts on Tuesday. This is mainly due to the improved risk sentiment in the global financial markets after China revealed its trade data for March that showed exports contracted less than expected.
Despite some weakness in the greenback, EURUSD struggles to regain the immediate hurdle in the form of the 50-DMA around 1.0960. As long as the pair remains below this region, the risk of a break under 1.09 persists. In part, euro’s bullishness is capped by the fact that the potential impact from the coronavirus outbreak remains in market focus. On this front, the latest news headlines are contradictory. On the one hand, Germany said that new daily coronavirus cases continue to fall. On the other hand, Spain reported over 3,000 new coronavirus cases over the past 24 hours. Later in the day, the pair may be affected by speeches by FOMC’s Bullard, Evans, and Bostic as well as US import and export prices. Should dollar demand pick up again, the euro may easily get back below 1.09.
Meanwhile, USDJPY has settled around nearly two-week lows around 107.40 and remains under the selling pressure since rejection from the 109.40 area earlier this month. It looks like the pair is ready to break below the 107.00 handle that will turn into resistance for the first time since early-April. Of note, the safe-haven yen continues to rise despite a better risk sentiment, which confirms that traders still prefer a cautious approach amid the lingering risks related to the coronavirus outbreak across the globe.
Similarly, USDCHF has been losing ground today after a brief and modest bounce seen on Monday. The pair is holding around the 0.9630 support area but could challenge this local support should the greenback remain under a broad-based downside pressure in the near term. On the upside, there is a hurdle in the form of the 50-DMA around 0.9670. Once above this level, the bearish risks will abate.