News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bullish
More View more
Real Time News
  • Heads Up:🇮🇪 GDP Growth Rate QoQ (Q4) due at 11:00 GMT (15min) Previous: 11.1% https://www.dailyfx.com/economic-calendar#2021-03-05
  • Brush up your knowledge on #tradewars with this tool from DailyFX research briefly outlining trade-war history dating back to the early 1900s here: https://t.co/ZWaL6laTU5 https://t.co/8Kos5XrKhY
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/tPwOU9788l
  • 🇮🇹 Retail Sales MoM (JAN) Actual: -3% Previous: 2.4% https://www.dailyfx.com/economic-calendar#2021-03-05
  • 🇮🇹 Retail Sales MoM (JAN) Actual: -3% Previous: 2.5% https://www.dailyfx.com/economic-calendar#2021-03-05
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.32%, while traders in NZD/USD are at opposite extremes with 66.92%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/JMU0AUsalx
  • Heads Up:🇮🇹 Retail Sales MoM (JAN) due at 09:00 GMT (15min) Previous: 2.5% https://www.dailyfx.com/economic-calendar#2021-03-05
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZBx7g https://t.co/uGKuvX6S0K
  • Commodities Update: As of 08:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.22% Gold: -0.24% Silver: -0.75% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/JyykROg0Mk
  • Forex Update: As of 08:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: -0.13% 🇨🇭CHF: -0.18% 🇬🇧GBP: -0.26% 🇪🇺EUR: -0.32% 🇦🇺AUD: -0.44% 🇳🇿NZD: -0.53% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/NoeBuGFrZU
EURUSD Testing Critical 18-Month Resistance - Will it Hold?

EURUSD Testing Critical 18-Month Resistance - Will it Hold?

Dimitri Zabelin, Analyst

TALKING POINTS – EURUSD FORECAST, EURUZONE DATA, FED MONETARY POLICY

  • EURUSD may fall after Eurozone price growth data is published
  • Losses may be reversed if Powell’s speech contains dovish tones
  • Slowing global growth prospects pressuring central bank hawks

See our free guide to learn how to use economic news in your trading strategy!

EURUSD will likely experience higher-than-usual volatility in the next 24 hours as critical Eurozone CPI data is published along with US economic data and a speech from Fed Chairman Jerome Powell. Since economic data out of Europe has been tending to underperform relative to economists’ expectations for a few months now, it is likely price growth data will fall in-line with prevailing trends.

Disappointing US ISM data earlier today sent the US Dollar lower across all its major counterparts as markets priced in a greater probability of a cut from the Fed. The USD Index subsequently experienced an almost 0.50 percent drop. EURUSD promptly spiked and reentered 18-month descending resistance not reached since March. The critical question then is whether or not the roof will hold.

If market conditions sour and the outlook continues to worsen to such a degree that the Fed cuts interest rates, by that point market participants would likely be already putting a premium on liquidity over chasing yields. The US Dollar in this regard may actually be buoyed by investors looking to reduce their exposure cycle-linked assets and instead are searching for the warm embrace of the world reserve currency.

EURUSD would then likely retreat from its bold jump and continue trading below the 18-month roof. “It is also worth noting that the fundamental outlook for Europe still remains grim, and the upcoming ECB meeting will not likely have the feathers of hawks be the quill with which monetary policy is written. Dovish undertones from the ECB are expected in addition to a downward revision for European growth prospects.

CHART OF THE DAY: DXY USD INDEX PLUNGES, EURUSD TESTS 18-MONTH RESISTANCE FOR THE FIRST TIME SINCE MARCH

Chart Showing EURUSD, USD Index

--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES