Will the EUR/USD strengthen its position this weekend?
- Will the EUR/USD strengthen its position this weekend?
An unexpected increase of non-farm payrolls data during the month of February has roared the prices of many global stock markets including the US dollar. While U.S. Treasuries fell sharply as investors speculation of the U.S. economic recovery will be more solid. Observed so far, the U.S. dollar index rose from 0.98% to 82.93, while the highest point reported today at 82.94 and an intraday low at 82.10 daily. Economists predict the unemployment rate would stay stable at 7.9% as the ADP showed private sector to create 198,000 new jobs in February.
Investors are waiting for the data as a measure of nonfarm payrolls to predict the health of the economy and indeed to anticipate the Federal Reserve in the future. Fed officials have said that interest rate policy will continue until the unemployment rate fell to 6.5% and inflation rose to 2.5%.
However, bond purchase program known as quantitative easing is likely to stop much more quickly than planned, if the Fed sees a continuation in the following weeks!
Todays’s market announcement would indeed create a question, would GBP/USD rebound this weekend? will the Eur/USD strengthen its positions?
As a trader, we need to take a number of points into considerations:
First, the projected decline in the European economic growth with high inflation expectations is not good for the Euro, which had previously been weakened. However, optimistic outlook for the mid-to-2 years has sparked the movement over EURO.
The excessive amount of flow of funds into the Euro zones caused by Asraf Laidi’s explanation when Draghi did not mention ‘appreciation for the Euro’ as a risk factor in the growth rates fell as did their (ECB) in February.
The euro versus the U.S. dollar rose to its highest level this week at 1.3112 against the dollar on Thursday, after posting gains of more than 1% in a day, something that only happened one time before this year.
Technically, Pivot EUR / USD is at 1.3060. As long as prices traded above the area, the pair of EUR / USD potentially strengthened by heading to 1.3120 to 1.3175
Keep an eye on the eur/usd! beware if the price goes below 1.3064!