EUR/USD Daily Fundamental Forecast – July 24, 2017

The EURUSD pair has continued on its merry ways and it continues to move on its higher trajectory even when there is not much news around. On Friday, it was supposed to be a slow day with the absence of any news or events from the Eurozone and the US. But even on that day, we saw the euro show its strength as it continued to trade near the highs of its range with no signs of any correction during the course of the day and that bullishness has continued this morning as well.

EURUSD Continues to Roll

We believe that the next target of the pair would be to reach 1.18 during the short term and once that target is achieved, we might see some correction in the pair. It has to be noted that the pair is over and above the highs of the year and also it is now at the highest it has been since 2015. Also, we believe that the number of shorts in the dollar is also at one of the highest it has ever been and so, all of this posts a lot of risks and uncertainties for the dollar bears who are likely to exit very quickly at any sign of dollar strength.

Already, we believe that some of the dollar shorts might have begun to take profits. On the other hand, it is clear that keeping the dollar weak is a part of the monetary policy of the Trump administration and that is why they dont seem too worried that the dollar is trading in a very weak manner now. There has not been even a whimper from the Fed about the weak dollar and with the economic data from the US also not supporting the dollar in any manner, it has been left at the mercy of the market forces. The traders need to balance these thoughts before they make a trading decision.

This is the last week of the month and hence the economic calendar begins to dry up and we are likely to see some month end flows and also trade positioning ahead of the new month. We believe that the EURUSD pair would continued to trade in a buoyed manner for today.