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.

Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Are recent gains in the Indian Rupee and Nifty 50 warranted? Risks are brewing in the background, leaving USD/INR in a consolidative setting as the Nifty pressures resistance. Get your $USDINR market update from @ddubrovskyFX here:https://t.co/svDaSdprvN https://t.co/kgddX1ZHe4
  • I approve of this dry humor. https://t.co/b42GmIZDlL
  • The US Dollar may be at risk to losses against some of its #ASEAN counterparts. USD/SGD, USD/PHP, USD/MYR and USD/IDR have recently broken to the downside. Will losses continue? Find out from @ddubrovskyFX here: https://t.co/0RTlj6maTT https://t.co/59cdbPc4l7
  • The #Nikkei 225 trades at 4-month highs after a 50% surge from the March low, while the RSI registers its first overbought readings since November 2019. Get your market update from @DanielGMoss here: https://t.co/pOEt698Ooi https://t.co/EHD2EHmQLW
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/8gGfGuw87o
  • The $USD breakdown has taken the index into confluence support at the objective yearly open. Get your USD technical analysis from @MBForex here: https://t.co/A16XEv6n4d https://t.co/VFxFMFWJ5L
  • Texas virus cases increase 2.4%, above 7-day average of 2.3% - BBG
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.68% 🇨🇦CAD: 0.58% 🇬🇧GBP: 0.56% 🇪🇺EUR: -0.40% 🇯🇵JPY: -0.41% 🇨🇭CHF: -0.71% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/KqzhTKmnaK
  • The divergence between weekly gains in the #Fed balance sheet and with the #SP500 continues to grow https://t.co/A7HQRtukwj
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -1.11% Silver: -1.74% Gold: -1.78% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/oiiAzDSusO
EUR/USD Price Chart Shows Bullish Trend Remains

EUR/USD Price Chart Shows Bullish Trend Remains

2018-02-07 10:55:00
Nick Cawley, Strategist
Share:

EUR Talking Points

- Recent US dollar strength has weighed on EUR/USD but the uptrend remains in place for now.

- A German coalition government should underpin the single currency.

Check out our newTrading Forecasts - they’re free and have been updated for the first quarter of 2018.

EUR/USD Likely to Push Higher

The recent downturn in the most popular FX trading pair, EUR/USD, may prove short-lived if closely followed momentum and sentiment indicators prove to be correct. In addition with a German coalition government now likely – news sources are confirming this as we go to print – the EUR will take heart from a settled political backdrop in the single-zone’s largest member.

After making a new three-year high of 1.25360 on January 25 this year, EUR/USD has given back nearly two cents as US dollar picked up from its recent lows on better-than-expected US data, boosting expectations that the latest jobs and wage data may boost inflation in the coming months. A subsequent rally in US Treasury yields underpinned the greenback but the latest pull-back may yet run out of steam as yields drift lower again.

The chart below shows that while the pair have made three ‘lower highs’ in a row, the pair remain above all three EMAs – a positive sign, while the stochastic indicator - a measure of momentum - is touching oversold levels and may provide another boost to EUR/USD. A breakdown however, could see the pair retrace back to the 1.2200 level, before strength re-appears.

DailyFX chief currency strategist John Kicklighter took an in-depth look at EUR/USD in his latest Forex Market Report and posited that Speculating on (ECB) Rate Hikes 12 to 18 months Ahead is Extremely Indulgent

EUR/USD Price Chart Daily Timeframe (August 15, 2017 – February 7, 2018)

EUR/USD Price Chart Shows Bullish Trend Remains

Chart by IG

EUR/USD Sentiment Data Show Clients Remain Net Short

IG Client Sentimentshow 31.2% of traders are net-long with the ratio of traders short to long at 2.21 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.05687; price has moved 16.9% higher since then. The number of traders net-long is 11.8% higher than yesterday and 12.1% lower from last week, while the number of traders net-short is 11.3% higher than yesterday and 7.5% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is less net-short than yesterday but more net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

A German Coalition Government Would Underpin the Euro

As we write, it seems likely that the discussions between the German Chancellor Angela Merkel’s Christian Alliance and the Social Democrats have produced a new coalition government after months of wrangling. Germany has been without a government since the country held a general election on September 24, 2017. In the coming hours/days it will be interesting to see the make-up of any new coalition and which party gets the all-important finance ministry role.

DailyFX provide a wide range of free, constantly updated Trading Guides including Forex for Beginners, Top Trading Lessons and The Number One Mistake Traders Make.

--- Written by Nick Cawley, Analyst

To contact Nick, email him at nicholas.cawley@ig.com

Follow Nick on Twitter @nickcawley1

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

DISCLOSURES

News & Analysis at your fingertips.