EUR/USD Daily Fundamental Forecast – October 19, 2017

The EURUSD pair continued to move steadily higher during the course of trading yesterday, but overall, it seems to be stuck in a 300 pip range between the 1.17 and 1.20 regions and this range has dominated the trading over the last few weeks and it is likely to remain the case in the short term as well. With the lack of many fundamentals over the last 24 hours, it has been more of flow that has been driving the markets.

EURUSD Bounces from Lows

That is also one of the reasons why it has been difficult to fix any specific fundamentals to the price action from yesterday. The action has been consistent with range trading with the pair moving higher and lower and then bouncing off from the lows once again, as it happened yesterday. We are in the second half of the month, when the news from the different parts of the world begins to dry up and with this in mind, we believe that the range that we have specified above is likely to continue through till the end of the month.

With the lack of any kind of support from the Fed and also from the incoming data, the dollar has been steady at best and it is likely to remain so. The December rate hike is something that is still up in the air and it remains to be seen what the Fed would do. With the October data remaining choppy, the market is likely to shift its focus to November and hope that the data is strong enough for the Fed to make a push towards a rate hike in December.

Looking ahead to the rest of the day, apart from the unemployment claims data from the US, there is no other major news, as is usual for the second half of the month. We expect the consolidation and the ranging to continue with a bullish bias which should give a good time for the range and day traders alike.