(MENAFN- Daily Forex)

• After beginning last week's trading near the 1.11775 vicinity on Monday, the EUR/USD provided a bounce higher and went into this weekend once again within the higher elements of its mid-term range near the 1.13575 mark. However, as every Forex trader likely knows at this point, volatility has remained a steady and dangerous fixture even in the biggest currency pairs including the EUR/USD.
• Tomorrow's trading will be relatively light because of the absence of U.S and U.K banks from Forex because of banking holidays, but there will be no shortage of potential impetus for the EUR/USD.
• On Friday President Trump let it be known he is not happy with the pace of the E.U tariff negotiations. Instead of souring Forex traders on the EUR/USD and causing selling, but the currency pair seems to have reacted to the rather heightened rhetoric from the U.S White House with buying.

Wrong Interpretation of EUR/USD Movement

Yet, reading too much into intraday results in the EUR/USD based on the notion of financial institutions trading on the noise from President Trump could lead to wrong interpretations. Behavioral sentiment has certainly been sparked higher in the EUR/USD when a mid-term chart of six months is looked upon. But all it takes is a look at a three month chart to see the EUR/USD has swam in a rather choppy higher price range since late in the second week of April.

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Day traders will have to be careful early this week because of a sure lack of volume, which could cause odd movements in the EUR/USD with imbalanced orders. The return of the U.S and the U.K to Forex on Tuesday will be important, but on Thursday of this week the French and Germans will be on holiday which could mean their institutions employees will be absent in large numbers on Friday. The U.S will release GDP numbers on Thursday, but this could be upstaged by President Trump at any moment when he feels like speaking. The U.S Federal Reserve's FOMC Meeting Minutes will be released this Wednesday too for More Volatility While Sentiment Improves

The ability of the EUR/USD to gain and hold onto the higher elements of its value have been evident.

• The strong selloff which occurred on the 12th of May and brought the EUR/USD to the 1.10640 vicinity needs to be remembered by all day traders, because only a few days before the currency pair was near its current values.
• Financial institutions appear to be leaning into a stronger EUR/USD, but they also have shown they are rather susceptible to momentary market scares caused by what feels like a continuous onslaught of developing news.
• So while sentiment appears to be better and traders may be tempted to look for upside in the EUR/USD, they should remain quite conservative with their bets near-term.

EUR/USD Weekly Outlook:Speculative price range for EUR/USD is 1.12860 to 1.149390

The EUR/USD touched a high of nearly 1.15780 on the 21st of April. However since then a range around the current price of the EUR/USD has appeared to have taken on a magnetic like effect as equilibrium. Financial institutions may believe the EUR/USD should be slightly higher, but clarity of outlook remains difficult to attain. The U.S Fed appears to be in a position in which it will have to consider an interest rate cut, but Fed Chairman Jerome Powell continues to say economic prospects remain uncertain.

President Trump's brief tirade against the E.U trade negotiations caught some by surprise this past Friday, but it did not cause a rupture in the EUR/USD. Higher terrain was attained on Friday, and the ability to go into this weekend near these highs may be looked upon as positive mid-term. However, short and near-term trading remains vulnerable to sudden reactions. Looking for upside in the EUR/USD may feel correct, but cautious traders may want to consider technical support levels as a place to look for reversals higher instead of buying blindly into the market under current circumstances.

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EURUSD Chart by TradingView

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