EUR/USD Daily Fundamental Forecast – March 30, 2017

The EURUSD pair continued to suffer yesterday as it broke through 1.08 and continued its way towards 1.07 where it is likely to see some strong buying coming in and it should stay supported in that region. The dollar continued its strength, as we had mentioned in our forecast yesterday and this was enough to keep the pair under some pressure for most of the day. A combination of technical and fundamental events helped to keep the EURUSD low and it was also the day when Article 50 was finally invoked in the UK and this is also likely to impact the euro in the long run. But for now, here is where we are and so far, there has not been much change in the euro as a result of the invocation.

Euro Under Pressure But Support Awaits

Yesterday, we had reports saying that the message from the ECB in March, which is one of the reasons why the euro has been well bid of late, was being over interpreted by the markets. The ECB had said that the euro economy was picking up slowly and it was beginning to tick all the boxes which would help the ECB to achieve its goals. This was taken as a hint that the QE would begin to be reduced by the ECB during the coming months but yesterday, reports suggested that the ECB did not quite mean that and all it meant was that the risks in the economy were tailing off.

This kind of news led to a small sell off in the euro which, in addition to the dollar strength, pushed the pair towards 1.07. But buyers in this pair can look to buy the euro if and when it gets to 1.07 as there is likely to be a lot of support in this region and we should see a lot of buying emerging in this region.

Looking ahead to today, we do not have any major news from the Eurozone but we have the GDP data from the US which will give additional hints on the state of the US economy.