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EUR/USD Daily Fundamental Forecast – December 08, 2016

By:
Colin First
Updated: Dec 8, 2016, 07:15 UTC

EURUSD again had a day of consolidation and ranging yesterday though the US session was more lively than the Asian and the London session as the dollar

EUR/USD Daily Fundamental Forecast – December 08, 2016

EURUSD again had a day of consolidation and ranging yesterday though the US session was more lively than the Asian and the London session as the dollar weakened across the board and this helped the pair to move up above 1.0750. The dollar weakened as the yields dropped during the NY session and the bulls were encouraged as the pair had not broken 1.0680 and this provided a lot of confidence for the bulls to take the pair higher.

EURUSD Hourly
EURUSD Hourly

The pair seems to be resting and consolidating itself in anticipation of the ECB rate and the ECB Press conference later on today. There has been a lot of talk in the market about how and when the ECB is going to stop the QE program that is currently underway. Though it is clear that the program cannot be stopped abruptly and that there has to be a way of slowly turning off the tap, what the market would be interested to know is how the ECB is going to handle this. The market would like to know if the tapering is going to begin immediately and would like to have a timeline for the same. The ECB President Draghi is generally not known to be too bullish or too dovish and so we can expect more of the same from him tomorrow where we expect him to present a balanced statement on how he is going to manage the QE program but the market will have a way of finding out the true meaning and we need to watch the reaction of the market. We believe that there is still some fuel left in the tank which should carry the EURUSD pair higher.

But this is a news event and anything can happen and even if the news turns out as per expectations, there is no guarantee that the market should react to it, the way we expect it to. So, expect a lot of volatility today and ensure that you trade after the dust settles.

 

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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