Good day forex traders and readers.
Welcome to the weekly EUR/USD review and let us be prepared for a new week of forex trading. The EUR/USD is the most popular currency pair among retail forex traders but it remains one of the more volatile currency pair. Therefore always remember to practice proper money management.
In the previous EUR/USD forecast we noted that the 1.3280 region continued to resist bullish attempts to push higher. Investors were apprehensive regarding the status of quantitative easing tapering by the US Federal Reserve.
Looking at the EUR/USD daily chart above we note that the currency pair breached the resistance of 1.3280 and had since eased below it again. On the downside, bearish pressure brought the EUR/USD down for a test of the 1.32 support.
The resistance of 1.3280 remains critical. Should it fail, we may be looking at a retest of 1.34. Any bearish momentum will need to overcome 1.32 and the middle bollinger band which currently lies around 1.3180.
The US Non-Farm Payroll turned out to be not as strong as expected, falling short on the number of jobs created. Having said so the US employment rate did fall to a low of 7.4%. This drove mixed sentiments across investors as they pondered the data potential impact on the US Federal Reserve consideration of quantitative easing tapering.
While the European Central Bank maintained the current interest rates during the minimum bid rate meeting, the ECB president mentioned that interest rates would remain low in the foreseeable future and this will definitely dampen investors’ sentiment.
Next week sees a number of economic releases, especially on the Euro Zone side. Data such as retail sales and industrial production is due and hence we need to monitor the impact on sentiments.