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CFD Trading Rate Euro vs US Dollar (EURUSD)

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  • 28.03.2024 11:41
    EUR/USD: Additional gains back above 1.0800 in the session would be supportive of a mild rebound – Scotiabank

    EUR/USD is edging off its intraday low open but remains below 1.0800. Economists at Scotiabank analyze the pair’s outlook.

    Resistance is seen at 1.0845/1.0855

    EUR/USD losses have edged off the intraday low at 1.0775 and short-term price signals are leaning bullish as a result. 

    The six-hour chart reflects a potential ‘doji’ candle developing now. 

    Additional EUR gains back above the 1.0800 zone in the session ahead would be supportive of a mild rebound in the pair at least. 

    Resistance is seen at 1.0845/1.0855.

     

  • 28.03.2024 08:33
    EUR/USD pushes lower after disappointing German Retail Sale
    • EUR/USD takes another step lower on poor German Retail Sales data. 
    • Subdued consumer spending levels in Germany increase the probability the ECB will cut interest rates soon. 
    • This contrasts with the US, where Fed officials are advocating a delay in rate cuts. 

    EUR/USD edges down on Thursday, retesting key support at 1.0800, after the release of subpar German Retail Sales data raised further concerns over the health of Europe’s largest economy, weighing on the Euro (EUR). 

    EUR/USD downtrend continues on fears Fed could delay cuts

    EUR/USD’s move down extends the short-term downtrend that started after the rollover from the March 8 highs in the 1.0980s. The main catalyst appears to be the diverging commentary from rate-setters at the US Federal Reserve (Fed) and European Central Bank (ECB). 

    Whilst at the beginning of March the ECB was signaling it would cut interest rates by June and the Fed potentially by as early as May, recent higher-than-expected US data and sticky inflation has led many Fed officials to question whether it may be too early to start cutting interest rates. 

    The view the Fed may keep interest rates higher for longer has supported the US Dollar (USD) because higher interest rates tend to attract more foreign capital inflows. This is bearish for EUR/USD, which measures the buying power of a single Euro in USD terms. 

    On Wednesday, Federal Reserve board member Christopher Waller added his voice to those advocating a delay, saying that “there is no rush to cut the policy rate,” in a speech to the Economic Club of New York, according to Reuters. 

    ECB officials, on the other hand, have cleaved increasingly to June. Eurozone economic data has been on the whole disappointing compared to US data, although persistently high wage inflation still concerns some policymakers. 

    EUR/USD took another step lower on Thursday after German Retail Sales in February showed shoppers on the whole tightening their purse strings. Weakening consumer spending is another sign inflation will come down further, prompting the ECB to cut interest rates. 

    Retail Sales fell 2.7% YoY in Germany, which was far below estimates of a 0.8% decline, according to data from Statistisches Bundesamt Deutschland. Month-on-month the 1.9% decrease must have come as a shock after economists predicted a 0.3% rise.

    Friday’s US core Personal Consumption Expenditures (PCE) Price Index data for February – the Fed’s preferred gauge of inflation – is likely to be an even more important release for EUR/USD. 

    A higher-than-expected result could push even further back the time when the Fed is expected to cut interest rates, with negative consequences for the pair. 

    Technical Analysis: EUR/USD continues pushing lower

    EUR/USD extends the dominant short-term downtrend that started at the March 8 high. It is currently retesting key support at around 1.0800. 

    Euro versus US Dollar: 4-hour chart

    The pair formed a three wave price pattern called a Measured Move back in February and early March and the low of wave B is underpinning key support at just above 1.0800. 

    If the downtrend continues and breaks decisively below the B-wave lows at roughly 1.0795 it would signal a continuation of the downtrend even lower, to the next target at 1.0750, followed by the February lows at roughly 1.0700. 

    A decisive break is one characterized by a long red bearish candle that breaks cleanly through the level and closes near its low, or three down candles in a row that breach the level. 

    Alternatively, a move above the 1.0950 level would bring into question the validity of the short-term downtrend. 

     

    Euro FAQs

    The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

    The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

    Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

    Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

    Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

     

  • 28.03.2024 08:14
    EUR/USD could crack the 1.0800 mark on the Easter weekend – Commerzbank

    EUR/USD struggles to gain traction in the second half of the week. Will the easter bunny bring quotes below 1.0800? Economists at Commerzbank analyze the pair’s outlook.

    Maybe a little tailwind for the Dollar

    The real data heavyweight is not on the agenda until Good Friday: the deflator for consumer spending or the PCE index, the Fed's preferred measure of inflation. However, as the consumer and producer price data for February have already been published, the PCE index is normally quite easy to forecast. 

    Our experts expect +0.4% month-on-month and +0.3% for the core rate, which should mean annual rates of 2.5% and 2.8% respectively. The data for December and January are likely to be revised slightly upwards.

    Although June is now back in focus as the timing for the first Fed rate cut, the still stubbornly high inflation data or statements such as that made by FOMC Governor Christopher Waller at the Economic Club of New York that there is no rush to cut the key interest rate, could still lead to the Dollar gaining a tailwind in thin markets and EUR/USD cracking the 1.0800 mark on the Easter weekend.

     

  • 28.03.2024 08:03
    EUR/USD could head to 1.0780 and perhaps 1.0750 under 1.0800 support – ING

    EUR/USD holds slightly above the 1.0800 level. Economists at ING analyze the pair’s outlook.

    Trading conditions will continue to be sticky

    We suspect that if it were not for month-end portfolio re-balancing flows, EUR/USD would be trading below 1.0800 now. And that looks the risk heading into Friday's release of February core PCE inflation data for the US, which is expected at a sticky 0.3% month-on-month. 

    Under 1.0800 support, we could see EUR/USD heading to 1.0780 and perhaps 1.0750. However, one month EUR/USD traded volatility below 5% suggests trading conditions will continue to be sticky.

     

  • 28.03.2024 04:04
    EUR/USD inches lower to near 1.0820, focus on German Retail Sales, US GDP Annualized
    • EUR/USD extends its losing streak on dovish remarks from ECB officials.
    • US GDP Annualized is expected to be consistent at a 3.2% increase in Q4.
    • German Retail Sales (MoM) is anticipated to show a 0.3% rise, against the previous decline of 0.4%.

    EUR/USD continues to lose ground for the third successive session on Thursday, inching lower to near 1.0820 during the Asian session. However, the US Dollar (USD) exhibits tepid momentum ahead of the Gross Domestic Product Annualized data from the United States (US) for the fourth quarter of 2023. Furthermore, traders will likely observe the Personal Consumption Expenditures for February.

    The US Dollar Index (DXY) hovers around 104.30, correcting from March’s highs. US Treasury yields retrace losses registered in the previous two sessions, which could provide support for the US Dollar.

    Market participants await fresh guidance from the Federal Reserve (Fed) regarding its interest rate trajectory. However, conflicting opinions among members of the Federal Open Market Committee (FOMC) regarding monetary policy easing are contributing to market confusion.

    Federal Reserve Board Governor Christopher Waller maintains his stance of 'no rush' to cut rates, citing persistent inflation data. Atlanta Fed President Raphael Bostic echoes a similar sentiment, anticipating only one rate cut this year, warning against premature rate reductions that could exacerbate economic disruptions.

    The Euro faces downward pressure as European Central Bank (ECB) officials are increasingly suggesting a probable interest rate cut in June. Yannis Stoumaras remarked on Tuesday that there is a mounting consensus within the ECB for a rate reduction in June, a sentiment echoed by Madis Muller, who hinted at the ECB nearing a point where rate cuts are feasible.

    Thursday will bring German Retail Sales data for February. The data is expected to show a decrease of 0.8% year-over-year. While the monthly report could reveal an increase of 0.3%, swinging from a previous decline of 0.4%.

    EUR/USD

    Overview
    Today last price 1.0823
    Today Daily Change -0.0005
    Today Daily Change % -0.05
    Today daily open 1.0828
     
    Trends
    Daily SMA20 1.0877
    Daily SMA50 1.0839
    Daily SMA100 1.0874
    Daily SMA200 1.0837
     
    Levels
    Previous Daily High 1.0839
    Previous Daily Low 1.0811
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.0822
    Daily Fibonacci 61.8% 1.0828
    Daily Pivot Point S1 1.0813
    Daily Pivot Point S2 1.0798
    Daily Pivot Point S3 1.0785
    Daily Pivot Point R1 1.0841
    Daily Pivot Point R2 1.0854
    Daily Pivot Point R3 1.0869

     

     

  • 27.03.2024 21:01
    EUR/USD holds ground amid ECB dovish signals
    • EUR/USD slightly down finding support despite ECB's dovish turn and mixed signals from Fed officials.
    • ECB officials signal potential for June rate cut, adding a dovish tone to policy outlook amidst wage inflation discussions.
    • Market awaits core PCE inflation data and GDP figures in the US, with Fed's divided stance on rate cuts in focus.

    The Euro trims some of its earlier losses against the US Dollar but stays in the red, as the EUR/USD trades at 1.0227, down 0.03%. Recent European Central Bank (ECB) dovish comments contradict the division amongst US Federal Reserve policymakers, who remain looking for evidence of the evolution of the disinflation process.

    EUR/USD steadies as central banks' contrasting stances

    The DXY, which measures a basket of American currency against six others, is almost unchanged at 104.29. The fall of US Treasury bond yields kept the EUR/USD from diving below 1.0800, which could have opened the door for further losses.

    In the meantime, ECB policymakers had turned dovish. On Tuesday, ECB official Yannis Stoumaras stated that there is a growing consensus for a June rate cut, while Madis Muller echoed some of his comments, indicating that the ECB is nearing the stage where it can lower rates.

    ECB Chief Economist Philip Lane said on Tuesday that wage inflation—a metric the ECB is following very closely to inform its policy—was “on track” to return to normal levels.

    Federal Reserve’s policymakers divided

    On the US front, Fed officials continued to lay the groundwork for easing policy, but there’s division among the Federal Open Market Committee (FOMC) board. Atlanta’s Fed Raphael Bostic noted that he expects one rate cut instead of two in 2024. Meanwhile, Fed Governor Lisa Cook said that easing policy too soon increases the risk of inflation becoming entrenched.

    Chicago Fed President Austan Goolsbee, leaning on the dovish side, expects three cuts, though he says he needs more evidence of inflation “coming down.”

    Traders eye US PCE figures and further economic data

    In the US economic docket, investors will eye the release of Gross Domestic Product (GDP) figures for the last quarter of 2023, unemployment claims, and the Fed’s preferred gauge for inflation, the core PCE.

    EUR/USD Price Analysis: Technical outlook

    The EUR/USD break below the 200-day moving average (DMA) at 1.0836 cleared the path to challenge 1.0800, but thin volumes kept the exchange rate above 1.0810 the day’s low. Nevertheless, the Relative Strength Index (RSI) remains bearish and aims lower. That said, the pair bias remains bearish. If sellers drag prices below 1.0800, the pair could challenge the February 14 low of 1.0694.

    On the flip side, buyers reclaiming  1.0836, the 200-DMA further upside is seen at the 100-DMA at 1.0873 ahead of 1.0900.

    EUR/USD

    Overview
    Today last price 1.0828
    Today Daily Change -0.0003
    Today Daily Change % -0.03
    Today daily open 1.0831
     
    Trends
    Daily SMA20 1.0877
    Daily SMA50 1.084
    Daily SMA100 1.0873
    Daily SMA200 1.0838
     
    Levels
    Previous Daily High 1.0864
    Previous Daily Low 1.0824
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.084
    Daily Fibonacci 61.8% 1.0849
    Daily Pivot Point S1 1.0816
    Daily Pivot Point S2 1.08
    Daily Pivot Point S3 1.0776
    Daily Pivot Point R1 1.0856
    Daily Pivot Point R2 1.088
    Daily Pivot Point R3 1.0896

     

     

  • 27.03.2024 13:47
    EUR/USD: Bargain hunters to look at dips to near 1.0800 as a buying opportunity – Scotiabank

    EUR/USD holds a very narrow range in the low 1.0800s. Economists at Scotiabank analyze the world’s most popular currency pair outlook.

    Resistance is seen at 1.0865/1.0875

    Bargain hunters are still likely to look at dips to near 1.0800 as a buying opportunity for now.

    Short-term trend dynamics are neutral while the daily and weekly DMIs still lean, if only moderately, EUR-bullish. That should limit downside pressure on spot in the near term at least. 

    Resistance is 1.0865/1.0875.

    See: EUR/USD can stabilise around 1.0850 – ING

  • 27.03.2024 09:50
    EUR/USD resumes downtrend on diverging interest-rate outlook
    • EUR/USD has resumed its short-term downtrend, perhaps due to diverging commentary from central bankers. 
    • European rate-setters are converging on June as the possible moment for a cut in interest rates as inflation slows. 
    • Their counterparts in the US are advocating caution in respect to lower interest rates. 

    EUR/USD edges lower, trading in the lower 1.0800s on Wednesday, shrugging off just-released Spanish inflation data for March which met economists’ estimates of 3.2% for the headline plot. 

    The pair’s tick lower follows through on the previous day’s bearish reversal from the mid 1.0800s and likely reflects the diverging commentary from rate-setters at the US Federal Reserve (Fed) and European Central Bank (ECB). 

    Commentary from ECB officials is now indicating a high likelihood it will cut interest rates in June, whilst a delay from the Fed is still possible. This is causing weakness for the Euro and depressing EUR/USD, since lower interest rates tends to reduce foreign capital inflows. 

    EUR/USD falls as ECB language gets more dovish

    On Tuesday, ECB Governing Council member Madis Muller said that “we’re closer to a point where the ECB can start cutting rates.” 

    He added that “data may confirm the inflation trend for the ECB’s June meeting.”

    Just prior to his speaking. ECB Governing Council Member Fabio Panetta said that inflation was quickly falling to target and therefore there was a "consensus emerging" for a rate cut. His views were similar to that of the Bank of Greece Governor Yannis Stournaras. 

    ECB Chief Economist Philip Lane said on Tuesday that wage inflation – a metric the ECB is following very closely to inform its policy – was “on track” to coming back down to normal levels. 

    These dovish comments follow those from the Bank of France President Francois Villeroy de Galhau, who said April could even be in the frame for a first cut. Taken together with ECB President Christine Lagarde’s comments at the last ECB policy meeting, when she said the ECB would be reviewing policy on interest rates in June, the evidence is building to a compelling conclusion.

    Fed looks more split 

    By contrast, the Federal Reserve seems more split. Whilst Federal Reserve Chairman Jerome Powell seems to continue to advocate for a June rate cut, and the Fed’s official forecast is for three 0.25% cuts to its feds funds rate in 2024, some individual members have diverged from the official script. 

    On Tuesday, Federal Reserve Bank of Atlanta Governor Raphael Bostic said the Fed should take things slowly and that he now only expected one rate cut in 2024. 

    His view echoed those of his fellow Fed member of the board of governors Lisa Cook, who advocated for the Fed taking a “careful approach” to easing over time to “ensure inflation returns sustainably to 2.0%.” 

    She mentioned housing inflation, which remains quite high, though her view was that it would fall on lower rental demand. 

    On Monday, Chicago Fed President Austan Goolsbee said the persistence of housing inflation continued to surprise him, but that he felt it would ebb away over time.

    "The main puzzle has been about housing," Goolsbee said, a major component in the consumer spending basket that has accounted for a large share of recent headline inflation readings, according to Reuters. 

    In terms of US inflation, Friday’s Core Personal Consumption Expenditures (PCE) Price Index data for February, considered the Fed’s preferred gauge of inflation, is being held up as the next oracular event for determining when the Fed could cut interest rates. 

    A higher-than-expected inflation reading in line with most recent gauges of inflation in the US could push back further the time when the Fed is expected to cut interest rates, with negative consequences for EUR/USD.  

    Technical Analysis: EUR/USD resuming downtrend

    EUR/USD turned tail at Tuesday’s highs in the 1.0860s and plunged back down, falling in line with the dominant short-term downtrend. 


    Euro versus US Dollar: 4-hour chart

    A decisive break below the B-wave lows at roughly 1.0795 would signal a continuation of the downtrend to the next target at 1.0750 – then the February lows at roughly 1.0700. 

    A decisive break is one characterized by a long red bearish candle that breaks cleanly through the level and closes near its low, or three down candles in a row that breach the level. 

    Alternatively, a move above the 1.0950 level would bring into question the validity of the short-term downtrend.

     

    Euro FAQs

    The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

    The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

    Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

    Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

    Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

     

  • 27.03.2024 08:37
    EUR/USD can stabilise around 1.0850 – ING

    On Tuesday, EUR/USD temporarily moved above 1.0850 before ending the day at roughly unchanged levels. Economists at ING analyze the pair’s outlook.

    Limited impact of France budget news

    France hit the headlines on Tuesday as it reported the 2023 deficit at 5.5% of GDP, substantially above the 4.8% seen in 2022 and higher than the government target of 4.9%. We estimate that the deficit may well exceed 5% again in 2024.

    The Euro has – however – remained shielded from the news as OAT spreads didn’t move much. Fiscal concerns should rise again as we head into the September budget in France, but we think the European Central Bank will be well into its monetary easing process, making the general environment for eurozone bonds quite favourable.

    Looking again at this week, we do not see major catalysts for a break higher or lower in EUR/USD unless US core PCE surprises (consensus is clustered at 0.3% month-on-month). We think the pair can stabilise around 1.0850.

     

  • 27.03.2024 07:03
    EUR/USD Price Analysis: The potential support level is located near 1.0800
    • EUR/USD loses traction around 1.0830 on the renewed USD demand on Wednesday. 
    • The pair maintains the bearish outlook above the key EMA; RSI lies below the 50-midline. 
    • The first upside barrier is seen near 1.0853; the potential support level is located at 1.0800. 

    The EUR/USD pair trades in negative territory for two straight days near 1.0830 on Wednesday during the early European trading hours. The encouraging US economic data and the high-for-longer rate narrative from the Federal Reserve (Fed) provide some support to the US Dollar (USD) and drag the EUR/USD lower. 

    Technically, EUR/USD keeps the bearish vibe unchanged on the four-hour chart. The major pair is below the key 50- and 100-period Exponential Moving Averages (EMA), with the Relative Strength Index (RSI) lying below the 50-midline. This indicates that the further downside looks favorable for the time being. 

    The key resistance level for EUR/USD will emerge near 1.0853, portraying the confluence of the upper boundary of the Bollinger Band and the 50-period EMA. A break above the mentioned level will pave the way to the 100-period and a high of March 26 at 1.0864. Further north, the next hurdle is seen near a high of March 18 at 1.0906. 

    On the flip side, the potential support level is located at the 1.0800 round mark, representing the lower limit of the Bollinger Band, a low of March 22, and a psychological round figure. Any follow-through selling below the latter will see a drop to a low of February 16 at 1.0732, followed by a low of February at 1.0700. 

    EUR/USD four-hour chart 

    EUR/USD

    Overview
    Today last price 1.0832
    Today Daily Change 0.0001
    Today Daily Change % 0.01
    Today daily open 1.0831
     
    Trends
    Daily SMA20 1.0877
    Daily SMA50 1.084
    Daily SMA100 1.0873
    Daily SMA200 1.0838
     
    Levels
    Previous Daily High 1.0864
    Previous Daily Low 1.0824
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.084
    Daily Fibonacci 61.8% 1.0849
    Daily Pivot Point S1 1.0816
    Daily Pivot Point S2 1.08
    Daily Pivot Point S3 1.0776
    Daily Pivot Point R1 1.0856
    Daily Pivot Point R2 1.088
    Daily Pivot Point R3 1.0896

     

     

  • 27.03.2024 02:33
    EUR/USD remains depressed on stronger USD, manages to hold above 1.0800 mark
    • EUR/USD drifts lower for the second straight day amid some follow-through USD buying.
    • Bets for a June ECB rate cut undermine the Euro and further contribute to the downfall.
    • Traders might refrain from placing fresh bets ahead of the US PCE Price Index on Friday.

    The EUR/USD pair extends the previous day's rejection slide from the 100-day Simple Moving Average (SMA) resistance near the 1.0865 region and remains under some selling pressure for the second straight day on Wednesday. Spot prices, however, manage to hold above the 1.0800 mark during the Asian session, though seem vulnerable to slide further amid some follow-through US Dollar (USD) buying.

    The USD Index (DXY), which tracks the Greenback against a basket of currencies, climbs back closer to a multi-week high touched last Friday and remains well supported by the optimistic view for the US economy. The outlook was reinforced by the slightly better-than-expected release of US Durable Goods Orders data on Tuesday, which might force the Federal Reserve (Fed) to keep rates higher for longer amid still-sticky inflation. This, along with a softer risk tone, underpins the safe-haven buck and exerts some pressure on the EUR/USD pair.

    The shared currency, on the other hand, is weighed down by rising bets for a June rate cut by the European Central Bank (ECB). In fact, ECB policymaker Madis Muller said on Tuesday that we are closer to a point where the central bank can start cutting rates. Adding to this, ECB official Yannis Stoumaras commented that there is a consensus for a June rate cut. This is seen as another factor that contributes to the offered tone surrounding the EUR/USD pair and supports prospects for an extension of over a two-week-old downtrend.

    Moving ahead, Wednesday's economic docket features the release of the Spanish CPI report, which might influence the common currency and provide some impetus in the absence of any relevant data from the US. The focus, however, remains glued to the US Personal Consumption and Expenditure (PCE) Price Index on Friday. The crucial data will be looked for more cues about the Fed's policy path. This, in turn, should influence the near-term USD price dynamics and help determine the next leg of a directional move for the EUR/USD pair.

    EUR/USD

    Overview
    Today last price 1.0825
    Today Daily Change -0.0006
    Today Daily Change % -0.06
    Today daily open 1.0831
     
    Trends
    Daily SMA20 1.0877
    Daily SMA50 1.084
    Daily SMA100 1.0873
    Daily SMA200 1.0838
     
    Levels
    Previous Daily High 1.0864
    Previous Daily Low 1.0824
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.084
    Daily Fibonacci 61.8% 1.0849
    Daily Pivot Point S1 1.0816
    Daily Pivot Point S2 1.08
    Daily Pivot Point S3 1.0776
    Daily Pivot Point R1 1.0856
    Daily Pivot Point R2 1.088
    Daily Pivot Point R3 1.0896

     

     

  • 26.03.2024 20:32
    EUR/USD dips on buoyant US Dollar, as ECB officials remain dovish
    • EUR/USD drops below 1.0840 due to USD strength, buoyed by durable goods data and stable consumer confidence.
    • ECB rate cut hints fuel speculation amid divided Fed views on easing.
    • Market eyes Eurozone indicators, US inflation data for future EUR/USD direction.

    The Euro retraces against the US Dollar from weekly highs hit at 1.0864 and tumbles toward the 1.0820 region on Tuesday amidst a buoyant Greenback. At the time of writing, the EUR/USD trades at 1.0828 down 0.08%.

    EUR/USD adjusts amid strong US economic data and mixed ECB and Fed signals

    Economic data from the United States (US) bolstered the Greenback, which trimmed its earlier losses as depicted  by the US Dollar Index (DXY). The DXY which measures a basket of the American currency against six others, climbs 0.10% at 104.32.

    The US Census Bureau revealed that Durable Goods Orders for February rose 1.4% Month over Month, exceeding forecasts of 1.1% and January’s -0.9% plunge. The core Durable Goods Orders stood at 0.4% Month over Month, up from -0.3% and above the consensus of 0.4%. Elsewhere, the Conference Board (CB) revealed that Consumer Confidence was steady in March, yet it ticked down to 104.7 from 104.8, a downward revision from the previous month. The survey showed Americans blaming higher prices and soaring borrowing costs.

    Following the data, the fundamentals surrounding the EUR/USD pair remained unchanged. Money market traders speculate that the Federal Reserve (Fed) and the European Central Bank (ECB) could cut interest rates in June. Meanwhile, traders are seeking cues from central banks' speeches across both sides of the Atlantic.

    On Tuesday, ECB official Yannis Stoumaras commented that there is a consensus for a June rate cut. Madis Muller echoed some of his comments, indicating that the ECB is nearing the stage where it can lower rates.

    On the US front, Fed officials continued to lay the groundwork for easing policy, but there’s division among the Federal Open Market Committee (FOMC) board. Atlanta Fed President Raphael Bostic noted that he expects one rate cut instead of two in 2024. Meanwhile, Fed Governor Lisa Cook said that easing policy too soon increases the risk of inflation becoming entrenched.

    On the dovish spectrum, Chicago Fed President Austan Goolsbee expects three cuts, though he says he needs more evidence of inflation “coming down.”

    Traders eye Eurozone data, ahead of US PCE

    The Eurozone (EU) docket will feature the release of inflation data in Spain, Consumer Confidence in France, and Economic Sentiment in the whole bloc. On the US front, investors will eye the release of Gross Domestic Product (GDP) figures for the last quarter of 2023, unemployment claims,, and the Fed’s preferred gauge for inflation, the core PCE.

    EUR/USD Price Analysis: Technical outlook

    The EUR/USD was unable to achieve a decisive break of the 200-day moving average (DMA), opening the door to challenging the 1.0800 mark. With sellers regaining control, a breach of the latter will pave the way to test the February 20 low of 1.0761, followed by the February 14 swing low of 1.0694. On the other hand, if buyers reclaim the 200-DMA at 1.0837, the next resistance level would be 1.0864, ahead of 1.0900.

    EUR/USD

    Overview
    Today last price 1.083
    Today Daily Change -0.0007
    Today Daily Change % -0.06
    Today daily open 1.0837
     
    Trends
    Daily SMA20 1.0878
    Daily SMA50 1.0841
    Daily SMA100 1.0871
    Daily SMA200 1.0838
     
    Levels
    Previous Daily High 1.0842
    Previous Daily Low 1.0802
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.0827
    Daily Fibonacci 61.8% 1.0818
    Daily Pivot Point S1 1.0812
    Daily Pivot Point S2 1.0787
    Daily Pivot Point S3 1.0772
    Daily Pivot Point R1 1.0852
    Daily Pivot Point R2 1.0868
    Daily Pivot Point R3 1.0893

     

     

  • 26.03.2024 12:04
    EUR/USD: Move above 1.0872 liable to spur additional gains to 1.0900+ – Scotiabank

    EUR/USD recovers to mid/upper 1.0800s. Economists at Scotiabank analyze the pair’s outlook.

    Technicals are supportive

    Spot traded positively in response to another test of the 1.0800 area on Monday, confirming a bullish ‘piercing line’ candle on the chart through the close.

    Gains are nearing the 50% retracement of last week’s see-off (1.0872), with a move above here liable to spur additional gains to 1.0900+.

    Daily and weekly trend momentum remains bullish for the EUR, which has helped to bolster support for the EUR on dips and should help drive spot gains higher in the near term.

    Support is 1.0835.

  • 26.03.2024 08:42
    EUR/USD labors higher on profit-taking
    • EUR/USD continues its bounce higher as traders take profit after last week’s volatile sell-off. 
    • The divergence between Federal Reserve and European Central Bank speakers suggests future weakness is possible. 
    • US Durable Goods Orders are the main release for the pair on Tuesday. 

    EUR/USD is trading over a tenth of a percent higher in the mid 1.0800s on Tuesday, in line with broader US Dollar (USD) selling. 

    Both the US Dollar Index (DXY), which tracks the currency’s performance against a basket of competitors, and the highly correlated US 10-year Note yield are trading lower too. 

    EUR/USD has now broken back above the key 50-day and 200-day Simple Moving Averages (SMA) as it rebounds from the 1.0801 lows of the previous week.  

    EUR/USD bounces on profit-taking 

    EUR/USD continues Monday’s half-hearted bounce, probably on the back of profit taking after last week’s USD surge rather than specific fundamental drivers. 

    Although US New Home Sales data out on Monday showed a slight decline of 0.3% from the previous month, the overall economic picture continues to indicate the US economy is ticking over exceptionally well and inflation remains elevated. 

    This in turn suggests that the Federal Reserve (Fed) will not need not be too hasty in cutting interest rates, a key FX driver. Interest rates remaining higher for longer is positive for the Greenback as it attracts greater inflows of foreign capital. 

    On Monday, commentary from Fed speakers was overall hawkish, advocating for a delay in cutting interest rates. 

    The President of the Federal Reserve Bank of Atlanta, Raphael Bostic, said he only believed the Fed would cut once in 2024, as opposed to the official line which continues to be for three cuts. 

    Federal Reserve Governor Lisa Cook was cautious, arguing that the Fed needed to take a “careful approach” to easing over time to “ensure inflation returns sustainably to 2.0%.” 

    Their comments were probably responsible for the slight recovery in some USD pairs during Monday’s US session. 

    On Tuesday, US Durable Goods Orders for February will provide further intelligence on the US economy which could impact the pair. 

    The headline figure is expected to show a 1.3% rise in February following the 6.2% decline in January. A dramatic change from the expected could move EUR/USD, with a higher-than-forecast figure pushing the pair down and vice versa for a lower number. 

    ECB officials strike dovish tone

    In Europe by contrast, central bank officials struck a more dovish tone on Monday, with several European Central Bank (ECB) Governing Council members intimating the possibility of earlier-than-expected interest-rate cuts.

    ECB Member Fabio Panetta said that inflation was quickly falling to target and therefore there was a "consensus emerging" for a rate cut. His comments increase the probability of a rate cut in June – or even earlier.  A rate cut in April would be bearish for the Euro as lower interest rates attract less flows of foreign capital. 

    ECB Chief Economist Philip Lane said on Monday that he was “confident” wage inflation was "on track" to falling to a level consistent with the ECB meeting its 2% inflation target. Lane also said that at that point the ECB could start reversing its interest rate policy. 

    If anything, the widening gap between what Fed speakers are advocating and what ECB officials are saying should be pushing EUR/USD lower. However, it is possible that last week’s sell-off has already priced the Fed-ECB divergence.  

    Technical Analysis: EUR/USD pulls back in short-term downtrend

    EUR/USD continues to labor higher on Tuesday after bouncing off the lows of the wave B of the three-wave Measured Move pattern that unfolded higher during February and early March. 

    The current recovery looks like a pullback in an established short-term downtrend with eventual weakness likely to resume. 


    Euro versus US Dollar: 4-hour chart

    A decisive break below the B-wave lows at roughly 1.0795 would signal a continuation of the downtrend to the next target at 1.0750 – then the February lows at 1.0700. 

    A decisive break is one characterized by a long red bearish candle that breaks cleanly through the level and closes near its low, or three down candles in a row that breach the level. 

    Alternatively, a move above the 1.0950 level would bring into question the validity of the short-term downtrend. 

     

    Euro FAQs

    The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

    The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

    Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

    Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

    Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

     

  • 26.03.2024 07:57
    EUR/USD should be able to prevent much more pressure on the 1.0800 support – ING

    EUR/USD moved towards the 1.0850 mark in Monday's session. Economists at ING analyze the pair’s outlook.

    EUR/USD set to stabilise around or modestly above 1.0850

    Inflation numbers will be released in the next ten days in the Eurozone, with the EZ-wide March CPI estimate released on April 3. Barring major surprises, markets should continue to gain confidence about a June cut (21 bps already in the price), meaning that the EUR may lag other currencies that have short positioning and/or have higher beta to sentiment once a Dollar decline materialises. In our view, this can happen in the next month.

    For this week, EUR/USD should be able to prevent much more pressure on the 1.0800 support and stabilise around or modestly above 1.0850.

     

  • 26.03.2024 05:03
    EUR/USD struggles for a firm intraday direction, stuck in a range below mid-1.0800s
    • EUR/USD oscillates in a narrow range and is influenced by a combination of diverging forces.
    • The Fed’s projected three rate cuts in 2024 undermine the USD and lend support to the pair.
    • Rising bets for a June ECB rate cut keep the Euro bulls on the defensive and act as a headwind.

    The EUR/USD pair struggles to capitalize on the previous day's goodish rebound from the 1.0800 mark, or a three-week low and oscillates in a narrow range during the Asian session on Tuesday. Spot prices currently trade around the 1.0840 region, nearly unchanged for the day and remain at the mercy of the US Dollar (USD) price dynamics.

    Despite the optimistic outlook about the US economic growth, the USD Index (DXY), which tracks the Greenback against a basket of currencies, fails to attract buyers in the wake of mixed signals over the Federal Reserve's (Fed) rate-cut path. The US central bank said last week that it remains on track to cut interest rates by 75 bps this year. That said, several Fed officials expressed concern about sticky inflation and stronger-than-expected US macro data. This, in turn, holds back traders from placing fresh USD directional bets and leads to the EUR/USD pair's subdued/range-bound price action.

    The shared currency, on the other hand, is undermined by bets for a June rate cut by the European Central Bank (ECB). In fact, Bank of Italy Governor Fabio Panetta said on Monday that the ECB is moving towards an interest rate cut as inflation is falling rapidly and approaching the 2% target. Separately, ECB chief economist Philip Lane noted that the central bank can consider reversing interest rates once it becomes more confident that wage growth is slowing and inflation is heading back to the 2% target as projected. This further contributes to capping the upside for the EUR/USD pair.

    Market participants now look forward to the US economic docket, featuring the release of Durable Goods Orders, the Conference Board's Consumer Confidence Index and the Richmond Manufacturing Index later during the North American session. This, along with the US bond yield and the broader risk sentiment, will drive demand for the safe-haven buck and provide some impetus to the EUR/USD pair. The market focus, however, will remain glued to the release of the US Personal Consumption and Expenditure (PCE) Price Index – the Fed's preferred inflation gauge on Friday.

    EUR/USD

    Overview
    Today last price 1.084
    Today Daily Change 0.0003
    Today Daily Change % 0.03
    Today daily open 1.0837
     
    Trends
    Daily SMA20 1.0878
    Daily SMA50 1.0841
    Daily SMA100 1.0871
    Daily SMA200 1.0838
     
    Levels
    Previous Daily High 1.0842
    Previous Daily Low 1.0802
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.0827
    Daily Fibonacci 61.8% 1.0818
    Daily Pivot Point S1 1.0812
    Daily Pivot Point S2 1.0787
    Daily Pivot Point S3 1.0772
    Daily Pivot Point R1 1.0852
    Daily Pivot Point R2 1.0868
    Daily Pivot Point R3 1.0893

     

     

  • 25.03.2024 20:22
    EUR/USD nudges closer to 200-DMA amid weak US Dollar
    • EUR/USD approaches the critical 200-day moving average, reflecting a cautious optimism in currency markets.
    • Mixed Fed views and weaker US housing data contrast with ECB optimism on inflation and potential rate cuts.
    • Upcoming US Durable Goods Orders and Consumer Confidence figures, to update economic outlook.

    The Euro paired some of its Friday losses against the US Dollar, though it remains shy of reclaiming the 200-day moving average (DMA) at 1.0839. The Greenback has lost its momentum and remains offered late in the North American session, despite Federal Reserve (Fed) officials' commentaries. The EUR/USD trades at 1.0837, gains 028%.

    EUR/USD inches up as Fed officials and ECB commentary diverge

    Earlier, Atlanta’s Fed President Raphael Bostic projected one rate cut in 2024 if the US central bank embarks on slashing borrowing costs. Echoing some of his comments was Lisa Cook, with both adopting a cautious approach, emphasizing that easing policy prematurely could entrench inflation. On the dovish side, Chicago’s Fed Austan Goolsbee still sees three cuts in 2024, adding that they need to see evidence of inflationary declines.

    US housing data was weaker than expected as New Home Sales slumped 0.3%, with sales coming at 0.662 million, below estimates of  0.675 million and January’s 0.664 million. Elsewhere, the Chicago Fed announced the National Activity Index saw improvement, moving from -0.54 to 0.05, with positive developments across all four index categories.

    Across the pond, the Eurozone’s (EU) Consumer Confidence in Spain was almost unchanged, while European Central Bank (ECB) officials led by Mario Centeno said inflation has peaked. Fabio Panetta added that the EU’s inflation is quickly falling toward its 2% target, giving room to cut rates.

    In addition, the EU’s docket will feature Consumer Confidence in Germany and the GDP release in Spain. On the US front, Durable Goods Orders, CB Consumer Confidence, and the S&P/Cas Shiller Home Price Index would shed some light on the economy's status.

    EUR/USD Price Analysis: Technical outlook

    The EUR/USD is forming a ‘bullish harami’ candle pattern that would need buyers to reclaim the March 22 high of 1.0868, so they could be poised to challenge 1.0900.  Nevertheless, the Relative Strength Index (RSI) stills in bearish territory despite aiming slightly up, while the key 200-DMA caps the pair’s advance. If sellers moved in and dragged prices below last week’s 1.0806, that can expose 1.0800, followed by the February 14 low of 1.0694.

    EUR/USD

    Overview
    Today last price 1.0839
    Today Daily Change 0.0031
    Today Daily Change % 0.29
    Today daily open 1.0808
     
    Trends
    Daily SMA20 1.0879
    Daily SMA50 1.0843
    Daily SMA100 1.087
    Daily SMA200 1.0839
     
    Levels
    Previous Daily High 1.0868
    Previous Daily Low 1.0802
    Previous Weekly High 1.0942
    Previous Weekly Low 1.0802
    Previous Monthly High 1.0898
    Previous Monthly Low 1.0695
    Daily Fibonacci 38.2% 1.0827
    Daily Fibonacci 61.8% 1.0843
    Daily Pivot Point S1 1.0784
    Daily Pivot Point S2 1.076
    Daily Pivot Point S3 1.0718
    Daily Pivot Point R1 1.085
    Daily Pivot Point R2 1.0892
    Daily Pivot Point R3 1.0916

     

     

  • 25.03.2024 13:49
    EUR/USD: Failure to hold pivot low near 1.0795/1.0760 could mean deeper down move – SocGen

    EUR/USD defends 1.0800. Economists at Société Générale analyze the pair’s technical outlook.

    Crucial support at 1.0795/1.0760

    EUR/USD rebound faced interim hurdle near 1.0980 resulting in a gradual pullback. It has dipped below the 200-DMA and is approaching recent pivot low near 1.0795/1.0760 which remains an important support. Defence of this zone could result in rebound but it would be interesting to see if the pair can re-establish beyond last week high of 1.0945. Failure could mean persistence in decline.

    Break below 1.0795/1.0760 can lead to extension in down move towards February trough of 1.0695 and 1.0610.

     

  • 25.03.2024 11:45
    EUR/USD supported on dips to the 1.0800 area again – Scotiabank

    EUR/USD is finding a little bargain-hunting support in the low 1.0800s, economists at Scotiabank say.

    Potential for additional EUR gains is not obvious

    Price action has steadied and the EUR has found a minor bid against support in the 1.0800 area, where spot based at the end of February. But the lift seen in the EUR so far is limited and the potential for additional EUR gains is not obvious at this point. 

    EUR/USD gains through 1.0835/1.0840 should add to positive momentum in the near term and help lift spot to the mid/upper 1.0800s. 

    Support is 1.0800 and – firmer – 1.0775.

     

  • 25.03.2024 09:44
    EUR/USD bounces on broad USD selling, profit-taking
    • EUR/USD bounces on broad US Dollar selling after the Chinese PBoC decides to fix the Renminbi higher on Monday.
    • Profit-taking after the deep declines at the end of last week could be another factor. 
    • Comments from key central bankers could move the pair on Monday. 

    EUR/USD is trading about a tenth of a percent higher at the start of the week, in the lower 1.0800s, possibly as a result of broad US Dollar (USD) selling after the People’s Bank of China (PBoC) fixed the Renminbi surprisingly higher on Monday morning, according to Bloomberg News. 

    Although it is up on the day, the pair appears to be in a new short-term downtrend and is now firmly below the 200-day Simple Moving Average (SMA) at 1.0838, the last key MA obstructing further downside. 

    EUR/USD bounces on profit-taking after sell-off

    EUR/USD is bouncing on Monday due also perhaps to profit-taking. The pair suffered a substantial decline at the end of last week, following the release of Eurozone and US flash PMI data that highlighted US exceptionalism. 

    The data suggested the US economy is still doing pretty well and the Federal Reserve (Fed) may be being too hasty in expecting to make three interest-rate cuts this year. If the Fed changes its mind and cuts rates more slowly, it will be positive for the US Dollar since higher rates tend to attract greater inflows of foreign capital. 

    Despite Monday’s bounce, the Euro remains “fragile” to further weakness, according to analysts at ING, who think the surprise Swiss National Bank (SNB) decision to cut its interest rates on Thursday has stimulated “increased scrutiny of ECB communication,” for signs the European bank will follow suit. The ECB and SNB have a history of mimicking each other, although it is normally the SNB which follows the ECB, not the other way around. 

    “Following last week's surprise cut from the Swiss National Bank, there has been increased scrutiny on ECB communication. This remains mixed, with one hawk on Friday still talking up the chances of an April rate cut. Notably, money markets still ascribe a very low probability to such an outcome and we doubt that changes much this week given the absence of key data,” said ING in a recent note. 

    ING still sees a low probability of an early interest rate cut by the ECB, however, and volatility is likely to be minimalized by the lack of key data out for the Euro this week and the upcoming Easter holidays. 

    As far as calendar events go, European Central Bank President Christine Lagarde is scheduled to speak at 10:00 GMT on Monday. 

    The Federal Reserve Bank of Atlanta President Raphael Bostic is also scheduled to speak later in the day at 13:45 GMT, and is followed by the Federal Reserve member of the Board of Governors Lisa Cook at 14:30 GMT. 

    On the data front, US New Home Sales and the Chicago Fed National Activity Index will be released on Monday.  

    Technical Analysis: EUR/USD makes lower lows

    EUR/USD seems now to be in a short-term downtrend after making lower lows on Friday, and since the “trend is your friend” this, on balance, favors bearish bets. 


    Euro versus US Dollar: 4-hour chart

    EUR/USD has fallen to the low of wave B of the three-wave Measured Move pattern that unfolded higher during February and early March. This is likely to be a key support level and may see some stabilization of the exchange rate after the past week’s heightened volatility. 

    A decisive break below the B-wave lows at roughly 1.0795 would signal a continuation of the downtrend to the next target at 1.0750, possibly even the February lows at 1.0700. 

    A decisive break is one characterized by a long red bearish candle that breaks cleanly through the level and closes near its low, or three down candles in a row that breach the level. 

    Alternatively, a move above the 1.0950 level would bring into question the validity of the short-term downtrend.

     

    Euro FAQs

    The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

    The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

    Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

    Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

    Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

     

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