EUR/USD Forecast and News
EUR/USD keeps its range above 1.0850 amid risk-off mood
EUR/USD is oscillating in a tight range above 1.0850 in the European session on Tuesday. The pair stays cautious due to risk-off sentiment and a modest US Dollar uptick, as investors weigh the ECB and Fed rate cut expectations. The focus now remains on speeches from Fed officials.
Latest EUR News
EUR/USD Technical Overview
EUR/USD continues to trade within the ascending regression channel but the Relative Strength Index (RSI) indicator on the 4-hour chart declines toward 50, suggesting that the bullish bias intact while the momentum is waning.
1.0850 (mid-point of the ascending channel) aligns as immediate support before 1.0830 (50-period Simple Moving Average, Fibonacci 61.8% retracement of the latest downtrend) and 1.0810-1.0800 (lower limit of the ascending channel, static level). On the upside, first resistance is located at 1.0890 (Fibonacci 78.6% retracement) ahead of 1.0910 (upper limit of the ascending channel) and 1.0940 (static level).
Fundamental Overview
EUR/USD declined marginally on Monday but managed to stabilize above 1.0850 early Tuesday. The pair's near-term technical outlook points to a loss of bullish momentum as investors search for the next catalyst.
The trading action remained subdued in financial markets on Monday in the absence of high-tier data releases. Although the US Dollar (USD) held resilient against its major rivals following the latest comments from Federal Reserve (Fed) officials, it failed to gather bullish momentum. Early Tuesday, the US Dollar Index fluctuates in a tight range at around 104.50.
Fed Vice Chair for Supervision Michael Barr noted that the Fed was in a good position to keep the policy steady and watch the economic developments. Additionally, "we continue to see the labor market come into better balance, and inflation decline, though nowhere near as quickly as would have liked," Fed Vice Chair of the Board of Governors Phillip Jefferson said.
In the second half of the day, Fed Governor Christopher Waller, NY Fed President John Williams and Boston Fed President Susan Collins and Cleveland Fed President Loretta Mester will be delivering speeches.
Since the release of the April inflation data, Fed policymakers adopted a cautious tone regarding policy easing but refrained from hinting at the timing of the policy pivot. Hence, markets are likely to wait for the next macroeconomic data release before reassessing the rate outlook.
The US Department of Labor's weekly Initial Jobless Claims data and S&P Global's preliminary Manufacturing and Services PMI surveys for May on Thursday could trigger the next big reaction in EUR/USD.
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: Could FOMC Minutes provide fresh clues? Premium
The EUR/USD pair advanced for a fourth consecutive week, comfortably trading around 1.0860 ahead of the close. Progress had been shallow, as the pair is up roughly 250 pips from the year low of 1.0600 posted mid-April.
EUR/USD Big Picture
EUR/USD Bullish Themes
EUR/USD Bearish Themes
Latest EUR Analysis
Editors' picks
EUR/USD keeps its range above 1.0850 amid risk-off mood
EUR/USD is oscillating in a tight range above 1.0850 in the European session on Tuesday. The pair stays cautious due to risk-off sentiment and a modest US Dollar uptick, as investors weigh the ECB and Fed rate cut expectations. The focus now remains on speeches from Fed officials.
GBP/USD holds gains above 1.2700, awaits fresh catalysts
GBP/USD holds small gains above 1.2700 in European trading on Tuesday. Investors await fresh catalysts, with several Federal Reserve speakers and BoE Governor Andrew set to speak. Tuesday's Fedspeak weighed on rate cut expectations and fuelled a fresh US Dollar advance.
Japanese Yen recovers its losses, supported by a softer US Dollar
The Japanese Yen recovers its daily losses on Tuesday. Japanese Finance Minister Shunichi Suzuki voiced worries regarding the adverse effects of the weak Japanese Yen. The US Dollar edges lower due to a decline in US Treasury yields.
Gold pulls back after touching a new all-time high
Gold price (XAU/USD) retreats to the $2,410s on Tuesday as commentary from central bank policymakers around the globe reveals a reluctance to commit to lowering interest rates.
WTI moves below $79.00 following hawkish remarks from Fed officials
West Texas Intermediate Oil price extends losses to around $78.90 per barrel during the Asian session on Tuesday following the recent developments in the Middle East. However, the death of Iran’s President Ebrahim Raisi in a helicopter crash and emerging health concerns regarding Saudi Arabia’s King Salman bin Abdulaziz do not appear to be affecting the market.
Majors
Cryptocurrencies
Signatures
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.