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EUR/USD Fundamental Analysis – week of March 27, 2017

By:
Colin First
Updated: Apr 1, 2017, 03:19 UTC

As we near the near the end of the month, the new events generally dry up across the world and the focus begins to shift to the coming month and also to

EUR/USD

As we near the near the end of the month, the new events generally dry up across the world and the focus begins to shift to the coming month and also to the month end flows that are generally associated with certain currencies as banks have to settle certain accounts in order to balance their sheets. This leads to drying up of the liquidity and the loss of volatility in certain currencies and the rise of the same in certain others. This is something similar that we saw in EURUSD last week as the range for the pair for the entire week was only around 100 pips.

Euro In Tight Range

This was in contrast to the range that this pair has been having over the last few weeks but what should keep the bulls in this pair happy is the fact that the weekly close was higher than the open and also the fact that the pair ended above 1.08. Except for speeches from certain Fed members, there was not much in terms of economic events for EURUSD last week.

EURUSD Weekly
EURUSD Weekly

What dominated the headlines last week was the new healthcare bill that the Trump administration chose to introduce as a repeal of Obamacare but after several rounds of negotiations, his team could not get the required support from his own Republican party which was seen as a setback for Trump and also for the dollar. The full effect of the failure on the dollar is likely to be known only in the coming week as the uncertainty surrounding the bill and its lack of support became clear only towards the end of the last week.

Looking towards the coming week, we have the US GDP data and the German Ifo Business climate as we approach the end of the month. The EURUSD pair is now in a very crucial region between 1.0800 and 1.0850 and a break of 1.0850 would push the pair towards 1.100 in the short term but it should also be noted that this is the region which has seen the repeated failures of the bulls and so it is advisable to either stay away till 1.0850 is broken or maybe take off some profit in this region, if you are long already.

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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