EURUSD Forecast and News


EUR/USD falls below 1.0500 after US NFP data

EUR/USD dropped below 1.0450 but managed to stage a modest rebound. The US Dollar preserves its strength against its rivals and doesn't allow the pair to gain traction after the data from the US showed that Nonfarm Payrolls rose by 263,000 in November.

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Technical Overview

The Relative Strength Index (RSI) indicator on the four-hour chart stays within a touching distance of 70, suggesting that the pair could stage a technical correction before the next leg higher. On the upside, interim resistance seems to have formed at 1.0540. In case buyers manage to flip that level into support, additional gains toward 1.0600 (psychological level, static level) and 1.0630 (static level) could be witnessed.

1.0500 (former resistance, psychological level) aligns as initial support. With a four-hour close below that level, sellers could take action and drag the pair toward the 1.0410/1.0390 area, where the 20-period and the 50-period Simple Moving Averages are located.


Fundamental Overview

EUR/USD has gone into a consolidation phase above 1.0500 early Friday after having reached its highest level since June at 1.0540 earlier in the day. November jobs report from the US could ramp up the pair's volatility in the early American session.

The data published by the US Bureau of Economic Analysis revealed on Thursday that inflation in the US, as measured by the Personal Consumption Expenditures (PCE) Price Index, declined to 6% on a yearly basis in October from 6.3% in September. This reading came in below the market expectation of 6.2% and caused the US Dollar to continue to weaken against its rival.

Later in the session, the USD selloff picked up steam after the ISM reported that the Manufacturing PMI dropped to 49 in November from 50.2. More importantly, the Price Paid component of the PMI survey dropped to 43, pointing to a deceleration in the sector's input inflation.

As investors await the November jobs report, the US Dollar Index is already down more than 1% this week. Nonfarm Payrolls (NFP) are expected to rise by 200,000 following October's better-than-expected 261,000 increase.

Despite the upbeat October NFP reading, the US Dollar struggled to find demand as the details of the report revealed that the annual wage inflation declined to 4.7% from 5% in September. Hence, a similar market reaction could be expected. Unless the NFP beats the market expectation by a significant margin, the USD could face renewed selling pressure especially if wage inflation continues to soften. On the other hand, an unexpected increase in the Average Hourly Earnings (YoY) combined with an NFP print above 250,000 could force EUR/USD to turn south ahead of the weekend.

Nonfarm Payrolls Preview: Dollar selling opportunity? Low expectations to trigger temporary bounce.



SPECIAL WEEKLY FORECAST

Interested in weekly EURUSD forecast? Our experts make weekly updates forecasting the next possible moves of the euro-dollar pair. Here you can find the most recent forecast by our market experts:

EUR/USD: US Dollar fighting a losing battle Premium

EUR/USD: US Dollar fighting a losing battle

EUR/USD started December on a strong footing, reaching a fresh six-month high of 1.0544. The USD attempted to recover some ground at the beginning of the week but came under strong selling pressure following a speech from Powell.

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EUR/USD falls below 1.0500 after US NFP data

EUR/USD falls below 1.0500 after US NFP data

EUR/USD dropped below 1.0450 but managed to stage a modest rebound. The US Dollar preserves its strength against its rivals and doesn't allow the pair to gain traction after the data from the US showed that Nonfarm Payrolls rose by 263,000 in November.

EUR/USD News

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD lost nearly 100 pips with the immediate reaction to the upbeat November jobs report from the US and broke below 1.2200. The US Dollar Index clings to strong daily gains above 105.00 after the data showed that Nonfarm Payrolls rose by 263,000.

GBPUSD News

USD/JPY jumps after NFP erasing daily losses, finds resistance below 136.00

USD/JPY jumps after NFP erasing daily losses, finds resistance below 136.00

The USD/JPY jumped from 134.10 to 135.95, after the release of the US official employment report that showed better-than-expected numbers. The pair then pulled back toward 135.00 after the initial reaction.

USDJPY News

Gold retreats below $1,790 as US yields surge on US NFP

Gold retreats below $1,790 as US yields surge on US NFP

Gold price turned south and dropped below $1,790 in the early American session. The benchmark 10-year US Treasury bond yield is up more than 2% on the day near 3.6% after the bigger-than-expected November job growth, weighing heavily on XAU/USD.

Gold News

Crude Oil, WTI, testing key $81.00 level, eyes on test of $80.00

Crude Oil, WTI, testing key $81.00 level, eyes on test of $80.00

West Texas Intermediate (WTI) was buoyed by easing COVID-19 restrictions in China. However, at the time of writing, WTI is lower by some 0.2% in early Asia and hovers around $81.20 although remains in bullish territory having rallied through a major downside channel this week.

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EURUSD Yearly forecast

How could EURUSD 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 2022 EURUSD forecast!

EURUSD FORECAST 2022

In the EURUSD 2022 Forecast, our dedicated contributors expect the bearish trend to continue, almost during the Q1 and the Q2 of 2022. By the end of the year 2021, the average outlook for the pair was 1,1306. Read more details about the forecast.

From Jan 2021 to Dec 2021, the maximum level for the EURUSD (Euro US Dollar) was 1.2328 (on 06/01/21), and the minimum, 1.1200 (on 24/12/21).

MOST INFLUENTIAL POLITICAL EVENTS IN 2022 FOR EURUSD

Much water has run under the bridge in 2021. Central bankers from around the world have been cooling down speculation on persistently high inflation, calling in “temporarily,” and forecasting it would slowly stabilize to more suitable levels by 2022. But make no mistake: Hot inflation is the elephant in the room. Central banks' measures will be key for EUR/USD moves this next year. The coronavirus pandemic that hit the world in March 2020 still goes on and will also be a critical event in 2022, although there’s a better economic perspective.


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. 

The Federal Reserve Bank (Fed)

On the other hand we found The Federal Reserve System (Fed) wich is the central banking system of the United States. Fed has two main targets: to keep unemployment rate to their lowest possible levels and inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors, partially presidentially appointed Federal Open Market Committee (FOMC). The FOMC organizes 8 meetings in a year and reviews economic and financial conditions. Also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth.


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).

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.

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About EURUSD

The EURUSD (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 EURUSD 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 EURUSD 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.