EUR/USD Daily Fundamental Forecast – February 5, 2018

The EURUSD pair continues to consolidate and range between the 1.24 and the 1.25 regions over the last week or so and it has been unable to break through on either side despite many fundamental developments on both the euro side as well as the dollar side and we also have a lot of news from the US but none of these has been enough to push the euro on either side.

EURUSD Continues in Range

Last Friday, we saw the NFP data coming in stronger than expected and this brought in some weakness in the euro. The pair has risen to the highs of the range during the early part of trading on Friday and this weakness pushed the pair towards the 1.24 region. But the pair managed to hold its own in that region and the bounce began from there in a strong manner.

There was nothing specific which pushed the pair higher but it was more of global uncertainty which led to a crash in the stock markets around the world.  This crash in the markets helped to push the funds into currencies and that is one of the main reasons that the euro managed to hold its support and bounce from there and it continues to trade above the 1.24 region as of this writing. It remains to be seen what it would take for the pair to break through this range.

Looking ahead to the rest of the day, we do not have any major news from the Eurozone or the US for the day and so we can expect the consolidation and the ranging to continue for the day. But, we believe that we might see the start of the dollar rebound in the short and medium term as the focus shifts to the dollar over the next couple of months and this is likely to keep the pair under pressure.