EUR/USD Fundamental Forecast – September 23, 2016

Like the other USD related pairs, EURUSD also continued its upward grind during the whole of yesterday, a grind that began a couple of hours after the FOMC announcement. The bears could not break the support at 1.1145 even though they gave it their best shot and once the announcement and the details became known, the bulls took control of the price and started to slowly move it upwards. They faced a lot of selling pressure at 1.1200 and it took a while for the Euro to break through this resistance which it eventually did.

The bulls, once 1.1200 was broken, needed to enjoy their fruits of labor and they carried the price through till 1.1250, which was specified as a target by us, yesterday. Price stalled for quite a while at this price region due to a lot of selling as the market waited for Draghi to address his meeting and speak about the Euro economy. There wasnt anything special in his speech and the fact that he didnt want to rile the markets just after major announcements from different central banks across the world was clear. But just a day after the FOMC announcement and the resulting updward grind against the USD began, the USD strength slowly returned and the USD began to gain strength across all pairs. This affected the Euro as well and just like the upward grind, it began a slow downward grind overnight.