EUR/USD Starts the Week in Upbeat Mood

  • EURUSD
    (${instrument.percentChange}%)

EUR/USD – H4

The US Federal Reserve signaled rate hikes as early as March on Wednesday and the conclusion of its asset purchases program in the same month, while focus will shift to the European Central Bank (ECB) this week, as it hands down its monetary policy decision on Thursday.

The pair dropped after the Fed's decision, since the monetary policy differential works against it, but contained losses on Friday, despite US Core PCE inflation rising 4.9% y/y in December, compared to 4.7% prior.

On Sunday, Atlanta Fed President Raphael Bostic did not rule out a 50 bps rate hike if needed, on a Financial Times interview [1]. However, Mr Bostic is not a voter this year.

EUR/USD is in a good mood today, reacting from last week's plunge to the lowest level since June 2020. It tries to retake EMA100 (1.1200-10), which will ease downwards risk, but a catalyst will be needed in order to challenge mid-1.1200s and the descending trend-line form the January high.

Despite today's upbeat mood, the common currency is in a precarious position and vulnerable to 1.1120-1.1099, although 1.1049 looks distant at this stage.

Why Trade with FXCM

Commission free with fast, efficient execution.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 10 Dec 2022 https://www.ft.com/content/5f6fae25-de70-4977-aeb7-271fa3af5bc3

Disclosure

Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.

Risk Warning: Trading Margin FX/CFDs carries a high level of risk, and may not be suitable for all investors. Leverage can work against you. By trading, you could sustain a total loss of your deposited funds but wholesale clients could sustain losses in excess of deposits.

${getInstrumentData.name} / ${getInstrumentData.ticker} /

Exchange: ${getInstrumentData.exchange}

${getInstrumentData.bid} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}