(
MENAFN- Daily Forex) Bullish view
Buy the EUR/USD and set a take-profit at 1.0600. Add a stop-loss at 1.0400. Timeline: 1-2 days.
Bearish view
Set a sell-stop at 1.0480 and a take-profit at 1.0400. Add a stop-loss at 1.0600.
The EUR/USD
exchange rate continued rising as traders refocused on the upcoming
federal Reserve and European Central
bank (ECB) interest rate decisions. It also jumped as the US dollar
index plunged to its lowest level in over a month. The pair rose to a high of 1.0520, its highest point since December 17.
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Forex Brokers1 Get Started 74% of retail CFD accounts lose money Fed and ECB decisions
The EUR/USD exchange rate continued rising ahead of the upcoming Fed and ECB interest rate decisions. These decisions will help to set the tone for what to expect this year as the two economies recover.
Economists expect the Fed to leave interest rates unchanged in this meeting, as officials have hinted before. The economy is doing relatively well, with the services and manufacturing sectors making a slow comeback.
The ECB, on the other hand, is expected to deliver another interest rate cut because the European economy is slowing. Key countries like Germany and France are flirting with a recession.
Economists expect the ECB to be less dovish this year since recent data has been relatively strong. A report released on Friday showed that the Eurozone manufacturing PMI rose from 45.1 in December to 46.1 in January. The composite PMI moved from 49.6 to the expansion zone of 50.2.
While the ECB and Fed will be the key catalysts for the EUR/USD pair, there will be other catalysts. The Conference Board will release the upcoming consumer confidence data on Tuesday, while the statistics agency will release the first estimate of Q1 GDP data/USD technical analysis
The EUR/USD pair bounced back after falling to a low of 1.0180 earlier this month, where it formed a doji candlestick. A doji is a popular bullish reversal sign consisting of a small body and long upper and lower shadows.
The pair moved above the 23.6% Fibonacci Retracement level. It has also moved above the 50-day and 25-day moving averages. It also formed a small inverse head and shoulders chart pattern.
The pair has moved to the strong, pivot, reverse point of the Murrey Math Lines. Therefore, the EUR/USD pair will continue rising as bulls target the next important resistance level at 1.0600, the 38.2% retracement level. A drop below the key support at 1.0400 will invalidate the bullish view.
EURUSD Chart by TradingView
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