Never miss a story from David Song

Subscribe to recieve updates on publications
Please enter valid First Name
Please fill out this field.
Please enter valid Last Name
Please fill out this field.
Please enter valid email
Please fill out this field.
Please select a country

I’d like to receive information from Daily FX and IG about trading opportunities and their products and services via email.

Please fill out this field.

Your Forecast Is Headed to Your Inbox

But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with £10,000 virtual funds, which you can use to trade over 10,000 live global markets.

We'll email you login details shortly.

Learn More about Your Demo

You are subscribed to David Song

You can manage you subscriptions by following the link in the footer of each email you will receive

An error occurred submitting your form.
Please try again later.

EUR/USD snaps the December opening range, with the pair at risk of facing a larger decline ahead of the Federal Reserve & European Central Bank’s (ECB) last rate decisions for 2017 as the U.S. Non-Farm Payrolls (NFP) report is anticipated to show the economy adding another 195K jobs in November.

A further improvement in labor market dynamics accompanied by a marked pickup in Average Hourly Earnings is likely to trigger a bullish reaction in the U.S. dollar as it encourages the Federal Open Market Committee (FOMC) to stay on its current course of implementing three rate-hikes per year. In turn, Chair Janet Yellen and Co. may show a greater willingness to further normalize monetary policy in 2018 as the central bank ‘expects that economic conditions will evolve in a manner that will warrant gradual increases in the federal funds rate.’

Fed Fund Forecast

However, another batch of lackluster U.S. data prints may push the FOMC to deliver a dovish rate-hike in December, and the dollar may exhibit a more bearish behavior over the remainder of the year especially if a growing number of Fed officials trim the longer-run forecast for the benchmark interest rate. Interested in having a broader discussion on current market themes? Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

EUR/USD Daily Chart

EUR/USD Daily Chart

Broader outlook for EUR/USD has perked up as it breaks out of the downward trending channel from September, but the series of failed attempts to clear the 1.1960 (38.2% retracement) hurdle raises the risk for a near-term pullback as the pair carves a fresh series of lower highs & lows. The Relative Strength Index (RSI) highlights a similar dynamic as it snaps the bullish formation from November, with the next downside region of interest coming in around 1.1670 (50% retracement) followed by the 1.1580 (100% expansion) hurdle, which sits just above the November-low (1.1554).

New to the currency market? Want a better understanding of the different approaches for trading? Start by downloading and reviewing the FREE DailyFX Beginners guide!

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.