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EUR/USD Daily Fundamental Forecast – April 28, 2017

By:
Colin First
Published: Apr 28, 2017, 07:13 UTC

Yesterday, in our forecast, we had said that the ECB press conference could present a risk point for the EURUSD as it could lead to quite a bit of

EUR/USD Daily Fundamental Forecast – April 28, 2017

Yesterday, in our forecast, we had said that the ECB press conference could present a risk point for the EURUSD as it could lead to quite a bit of volatility depending on what picture Draghi wanted to present. It is pretty clear from the incoming data that the euro economy is improving and this should normally support the euro very much and keep the pair moving higher and higher towards 1.10 and further. On the other hand, we believe that the ECB would like to see the euro weak so that the economy continues to flourish and ideally, the ECB would like to see the pair between the 1.05 and 1.09 range.

Euro Goes on a Round Trip

It is due to this opposing views that we had warned of some decent volatility surrounding the press conference and thats what we got yesterday. During the first part of the conference, Draghi chose to focus on how the economy was doing well and how the data had been good and this helped the EURUSD pair to climb further and move through 1.09 and go as far high as 1.0933. But in the later part of the conference, he chose to focus on the downside risks and this made the pair retrace the entire bounce and the pair moved down below 1.09 and it rests in the support region around 1.0880 as of this writing.

EURUSD Hourly
EURUSD Hourly

The ECB would like to keep the euro under control and so we believe that they will do everything in their powers to keep the lid on on the euro. That is why we believe that the euro would find it very difficult to push its way through the range highs in the 1.0900 and 1.0950 region and make a move towards the 1.10 region, as most of the market expects it to.

Looking ahead to the rest of the day, we do not have any major news from the eurozone for the day but we have the advance GDP data from the US which could bring in a bit of volatility during the day.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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