Good day forex readers.
Welcome to our weekly review of the EUR/USD currency pair. It has been a decade since we started and we are only getting started! Read to the end to find out why.
In the previous EUR/USD forecast we noted that while the immediate momentum appeared bullish, we needed to see if a decisive push above the upper bollinger would happen. Without such, it is likely that the EUR/USD heads back towards the pivot of 1.16.
Looking at the EUR/USD weekly chart above, we noted that the currency pair did indeed closed the week in the vicinity of 1.16. I love it when our technical analysis aced!
As we are now back to the pivot region of 1.16, during such situation we should probably drop down to shorter time frame so as to observe for insights on the immediate price action. We are likely looking at 1.14 or 1.18 respectively as medium term targets.
It was reported that the ongoing trade war between the US and China is starting to weight down on the US economy. A number of analysts are turning dovish on the economic expectations. With no apparent end in sight, apprehension is likely to be on the rise.
The US Federal Reserve raised the interest rates as expected. As the rise was by and large foreseen, no major price action affected the EUR/USD. With the increase of the US interest rate, the interest gap between the US and Euro Zone widens. This may put the US currency in demand compared to the Euro currency which has a lower interest rate.
Over across the Atlantic, the trade war between the US and China is affecting the economics of the euro zone too. Considering the nature of our modern times where connectivity is everywhere, a drop in US or China economic activity will likely affect the rest of the world.
US Non-Farm Payroll is expected end week and we need to monitor if the wages grow at a healthy rate. Increased wages may lead to increased retail activity which in turn keeps the sellers in business.
The new week is light on data from the euro zone.
As we mentioned at the top, a new and exciting feature is on its way. Have you ever wonder if the US currency is weakening across the popular currency pairs? Or perhaps if there exist a pattern on how the currency pair acts durng the US Non-Farm Payroll? Stay tuned!
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