EUR/USD Forecast and News
EUR/USD turns negative near 1.0760
The sudden bout of strength in the Greenback sponsored the resurgence of the selling pressure in the risk complex, dragging EUR/USD to the area of daily lows near 1.0760.
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EUR/USD Technical Overview
On the upside, EUR/USD is likely to face first resistance at the May high of 1.0812 (May 3), which comes before the intermediate 100-day SMA of 1.0829 and the April top of 1.0885 (April 9). North of here is the March peak of 1.0981 (March 8), which precedes the weekly high of 1.0998 (January 11), all before the psychological threshold of 1.1000.
Looking south, a break of the 2024 bottom of 1.0601 (April 16) might mean a return to the November 2023 low of 1.0516 (November 1). Once this zone is cleared, spot may test the weekly low of 1.0495 (October 13, 2023), which is ahead of the 2023 low of 1.0448 (October 3) and the round level of 1.0400.
Fundamental Overview
EUR/USD struggles to regain impetus after Thursday’s marked advance, while a test of the key resistance area around 1.080 still remains elusive. In the meantime, spot is expected to maintain a cautious trade ahead of the key publication of the flash Michigan Consumer Sentiment for the month of May and speeches by Fed’s Bowman, Barr and Goolsbee.
Around the Federal Reserve, San Francisco Fed President Mary Daly commented on Thursday on the persisting policy restrictiveness, noting the potential need for additional time to bring inflation down to the Fed's target level. Earlier on Friday, Atlanta Fed President Raphael Bostic hinted at a possible economic slowdown, although the timing for rate cuts remains uncertain.
Still around the Fed, FOMC Governor Michelle Bowman, Chicago Fed President Austan Goolsbee and FOMC Governor Michael Barr are all due to speak.
Meanwhile, the narrative surrounding the monetary policy divergence between the Fed and the rest of its G10 peers continues to dominate the macro scenario in the FX universe.
On this, the FedWatch Tool tracked by CME Group sees the probability of a Fed’s rate reduction in September nearly 70%.
SPECIAL WEEKLY FORECAST
Interested in weekly EUR/USD forecast? Our experts make weekly updates forecasting the next possible moves of the Euro-US Dollar pair. Here you can find the most recent forecast by our market experts:
EUR/USD: Optimism surges ahead of the United States Consumer Price Index Premium
An uneventful week ended with some more action, as choppy trading prevailed until Thursday. The EUR/USD pair seesawed in a tight range just above the 1.0700 threshold for most of the week, with the US Dollar (USD) finally giving up and extending its slide while heading into the weekly close.
EUR/USD Big Picture
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Editors' picks
EUR/USD turns negative near 1.0760
The sudden bout of strength in the Greenback sponsored the resurgence of the selling pressure in the risk complex, dragging EUR/USD to the area of daily lows near 1.0760.
GBP/USD comes under pressure and challenges 1.2500
GBP/USD now rapidly loses momentum and gives away initial gains, returning to the 1.2500 region on the back of the strong comeback of the US Dollar.
USD/JPY gains following dismal US consumer report
USD/JPY climbs after worse-than-expected US consumer sentiment data. Recession fears reignited as Americans became less optimistic about the economy. A jump in US inflation expectations underpins US yields and the Greenback.
Gold retreats from highs on stronger Dollar, yields
XAU/USD trims part of its initial advance in response to the jump in the Dollar's buying interest and the re-emergence of the upside pressure in US yields.
Oil Price Analysis: Falling in a channel over the short-term
Oil is falling in a descending channel on the short-term horizon. Within the channel it is currently correcting higher, however, it is likely to capitulate and resume its downtrend. Only a decisive break out of the channel would reverse the short-term bearish outlook.
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EUR/USD Yearly forecast
How could EUR/USD move this year? Our experts make a EUR/USD update forecasting the possible moves of the euro-dollar pair during the whole year. Don't miss our 2024 EUR/USD forecast!
EUR/USD FORECAST 2024
In the EURUSD 2024 Forecast, our analyst, Valeria Bednarik, anticipates gains for the next couple of months. The Eurozone economy would need to show steady signs of recovery to prevent EUR/USD from collapsing below 1.0390 in the year's second half. Read more details about the forecast.
The pair traded as low as 1.0447 and as high as 1.1275 throughout 2023, with currencies moving on sentiment.
MOST INFLUENTIAL POLITICAL EVENTS IN 2024 FOR EUR/USD
There is a note of color that would stand out in the upcoming months: the US 2024 presidential election that will take place on November 5. The contest nomination will start as soon as January and run until June. The pinch of drama comes from Donald Trump’s desire to represent Republicans once again. A potential second government of Donald Trump could mean higher inflationary pressures as Trump could reintroduce tariffs on imports and push against the agreements between China and the Biden administration.
Influential Institutions & People for the EUR/USD
The Euro US Dollar can be seriously affected by news or the decisions taken by two main central banks:
The European Central Bank (ECB)
The European Central Bank (ECB) is the central bank empowered to manage monetary policy for the Eurozone and maintain price stability, so that the euro’s purchasing power is not eroded by inflation. The ECB aims to ensure that the year-on-year increase in consumer prices is less than, but close to 2% over the medium term. Another of its tasks is one of controlling the money supply. The European Central Bank’s work is organized via the following decision-making bodies: the Executive Board, the Governing Council and the General Council. Christine Lagarde is the President of this organism.
ECB Official Website, on Twitter and YouTube
The Federal Reserve Bank (Fed)
On the other
FED Official Website, on Twitter and Facebook
Christine Lagarde
Christine Lagarde was born in 1956 in Paris, France. Graduated from Paris West University Nanterre La Défense and became President of the European Central Bank in November 1st 2019. Prior to that, she served as Chairman and Managing Director of the International Monetary Fund between 2011 and 2019. Lagarde previously held various senior ministerial posts in the Government of France: she was Minister of the Economy, Finance and Industry (2007–2011), Minister of Agriculture and Fishing (2007) and Minister of Commerce (2005–2007).
Lagarde on ECB'S Profile and Wikipedia
Jerome Powell
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
Jerome Powell Fed's Profile and Wikipedia
ECB NEWS & ANALYSIS
FED NEWS & ANALYSIS
About EUR/USD
The EUR/USD (or Euro Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The popularity is due to the fact that it gathers two main economies: the European and American (from United States of America) ones. This is a widely traded currency pair where the Euro is the base currency and the US Dollar is the counter currency. Since the EUR/USD pair consists of more than half of all the trading volume worldwide in the Forex Market, it is almost impossible for a gap to appear, let alone a consequent breakaway gap in the opposite direction.
Normally, it is very quiet during the Asian session because economic data that affects the fundamentals of those currencies is released in either the European or U.S. session. Once traders in Europe get to their desks a flurry of activity hits the tape as they start filling customer orders and jockey for positions. At noon activity slows down as traders step out for lunch and then picks back up again as the U.S. comes online. If there is important U.S. data we can expect quiet markets just ahead of the number. U.S. economic news have the ability to either reinforce an existing trend or reverse it depending on by how much it missed or beat expectations with the EUR/USD news. By 5:00 GMT liquidity leaves the market once again as European traders close out positions and head home.
Related pairs
GBP/USD
The GBP/USD (or Pound Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs worldwide. This group also includes the following currency pairs: EUR/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The pair is also called 'The Cable', reffering to the first Transatlantic cable that was crossing the Atlantic Ocean in order to connect Great Britain with the United States of America. This term was originated in the mid-19th century and it makes GBP/USD one of the oldest currency pairs in the world.
The popularity of the Pound Dollar is due to the fact that represents two strong economies: British and American (from United States of America). The Cable is a widely observed and traded currency pair where the Pound is the base currency and the US Dollar is the counter currency. After the result of the Brexit referendum, where the majority of the British voted to abandon the European Union, GBP/USD has been suffering some turbulence in the Forex market as a consequence of the associated risks of leaving the single market.
USD/JPY
The USD/JPY (or US Dollar Japanese Yen) currency pair is one of the 'Majors', the most important pairs in the world. Japanese Yen has a low interest rate, normally used in carry trades, that's why is one of the most trades currencies worldwide. In the USD/JPY the US Dollar is the base currency and the Japanese Yen is the counter currency. The pair represents American (from United States of America) and Japanese economies.
Trading the USD/JPY currency pair is also known as trading the "ninja" or the "gopher", although this last name is more frequently used when reffered to the GBP/JPY currency pair. The US Dollar Japanese Yen usually has a positive correlation with the following two pairs: USD/CHF and USD/CAD. The nature of this correlation is dued to the fact that both currency pairs also use the US Dollar as the base currency, such as USD/JPY. The value of the pair tends to be affected when the two main central banks of each country, the Bank of Japan (BoJ) and the Federal Reserve Bank (Fed), face serious interest rate differential.