EUR/USD Forecast and News
EUR/USD climbs above 1.0800 as weak PMI data weighs on USD
EUR/USD preserves its bullish momentum and trades at its highest level in nearly three weeks above 1.0800 in the American session. The US Dollar stays under heavy selling pressure following the disappointing ADP and PMI data, fuelling the pair's rally.
Latest EUR News
EUR/USD Technical Overview
The daily chart for the EUR/USD pair shows it trades near a fresh weekly high of 1.0777, maintaining the upward pressure. The pair further advanced above a still bearish 20 Simple Moving Average (SMA), providing dynamic support at 1.0742. The 100 and 200 SMAs remain directionless, converging just below the 1.0800 mark and acting as a dynamic resistance. Finally, technical indicators have turned higher but barely cross their midlines into positive territory, still painting a neutral picture.
In the near term, and according to the 4-hour chart, the risk skews to the upside. Technical indicators gain upward traction within positive levels, reflecting increased buying interest. At the same time, a bullish 20 SMA advances above the 100 SMA, both below the current level, also indicating buyers' dominance.
Support levels: 1.0740 1.0700 1.0665
Resistance levels: 1.0810 1.0845 1.0880
Fundamental Overview
The EUR/USD pair advanced throughout the first half of Wednesday, as demand for the US Dollar fell following comments from Federal Reserve (Fed) Chairman Jerome Powell mid-Tuesday. Speaking at the European Central Bank (ECB) Forum on monetary policy in Sintra, Powell said that the disinflationary trend is giving signs of resuming, although he repeated they need to be more confident before reducing the policy rate.
Meanwhile, the Hamburg Commercial Bank (HCOB) released the final Services and Composite PMIs for the Eurozone for June, upwardly revising the previous estimates. The EU Composite PMI printed at 50.9, yet the official report reads: “The eurozone economy continued to grow at the end of the second quarter, although momentum was lost as the expansion,” as the index was the lowest in three months.
Across the pond, the United States (US) released the ADP report on private job creation. It showed that the sector added 150K new positions in June, below the revised 157K from May and missing the 160K expected. Nela Richardson, ADP chief economist, said: “Job growth has been solid, but not broad-based. Had it not been for a rebound in hiring in leisure and hospitality, June would have been a downbeat month.” As a result, the US Dollar shed some additional ground, under selling pressure ahead of Wall Street’s opening.
The US also released the June Challenger Job Cuts, which showed US-based employers announced 48,786 cuts in June, down 23.6% from the 63,816 cuts announced in May. Additionally, the May Goods and Services Trade Balance posted a deficit of $75.1 billion, better than anticipated. Finally, Initial Jobless Claims for the week ended June 28 surged to 238K, worse than the 235K anticipated by market players.
S&P Global will later release the June US Services and Composite PMIs, while the country will publish the official ISM Services PMI for the same month. Later in the American afternoon, the Federal Open Market Committee (FOMC) will unveil the Minutes of the latest monetary policy meeting.
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: US employment data and FOMC Minutes under the spotlight Premium
The EUR/USD pair traded lifeless for most of the week around 1.0700, barely reacting on Friday following the release of the United States Personal Consumption Expenditures Price Index.
EUR/USD Big Picture
EUR/USD Bullish Themes
EUR/USD Bearish Themes
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Editors' picks
EUR/USD climbs above 1.0800 as weak PMI data weighs on USD
EUR/USD preserves its bullish momentum and trades at its highest level in nearly three weeks above 1.0800 in the American session. The US Dollar stays under heavy selling pressure following the disappointing ADP and PMI data, fuelling the pair's rally.
GBP/USD extends rally toward 1.2800 as USD selloff continues
GBP/USD continues to push higher toward 1.2800 and trades at its highest level since mid-June on Wednesday. The disappointing ISM Services PMI data from the US weighs heavily on the US Dollar and allows the pair to target new multi-week tops.
Japanese Yen depreciates to fresh 38-year lows
The USD/JPY pair reaches a fresh 38-year high of 161.91.The Jibun Bank Japan Services PMI was revised downward to 49.4 in June, marking a reversal from May's 53.8. The US Dollar edges higher due to a recovery in yield on a 2-year Treasury bond.
Gold jumps above $2,350 after US data
Gold gathers bullish momentum and trades at its highest level in over a week above $2,350. Following the disappointing ADP Employment Change and Initial Jobless Claims data from the US, the 10-year US yield stretches lower, helping XAU/USD extend its daily rally.
WTI corrects to near $82.30 ahead of US economy and weekly Oil inventory data
WTI drops from two-month high of $83.77 as risks to Oil supply due to disruption in facilities at Gulf of Mexico eases. The US API reported a big drawdown in Oil inventories for the week ending June 28. Investors await the US NFP data for fresh guidance on the Fed’s interest rates.
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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.