Euro / U.S. DollarShort
EURUSD - Bearish Move Expected
Updated
Euro bounces back a little after falling sharply
The Euro (EUR) gained a little ground against the US Dollar (USD) on Monday. This might be because some traders were buying Euros after they had sold them recently (profit-taking).
Last week, the Euro fell a lot after data showed the US economy was doing better than expected. This data made some investors think the US Federal Reserve might not cut interest rates as much as they planned this year. Lower interest rates in the US would make the Dollar less attractive to investors.
Even though the Euro went up a little today, analysts still think it could fall more in the future. This is because the Swiss National Bank (SNB) surprised everyone by cutting rates last week. Investors are now wondering if the European Central Bank (ECB) might do the same. The ECB and SNB sometimes copy each other's decisions, although usually the SNB follows the ECB.
There isn't any important economic data coming out about the Eurozone this week, so there probably won't be many big changes in the exchange rate. Also, it's Easter holiday soon, which could mean less trading activity.
Euro stays strong despite calls for rate cuts
The Euro held its value even though some important people at the ECB said they think interest rates should be cut soon.
One ECB official said inflation is going down quickly and that most people at the ECB now agree to cut rates. This makes it more likely that the ECB will cut rates in June or even earlier. Lower rates would generally make the Euro less attractive to investors.
Another ECB official said he is confident that wages are not growing too quickly, which is another reason why the ECB might cut rates soon.
Short-term outlook for EUR/USD: Downward trend
In the short term, the Euro seems to be getting weaker against the Dollar. This is because the Euro has been making lower and lower prices recently. Investors often follow the trend, so this could mean more people will sell Euros in the coming days.
The Euro (EUR) gained a little ground against the US Dollar (USD) on Monday. This might be because some traders were buying Euros after they had sold them recently (profit-taking).
Last week, the Euro fell a lot after data showed the US economy was doing better than expected. This data made some investors think the US Federal Reserve might not cut interest rates as much as they planned this year. Lower interest rates in the US would make the Dollar less attractive to investors.
Even though the Euro went up a little today, analysts still think it could fall more in the future. This is because the Swiss National Bank (SNB) surprised everyone by cutting rates last week. Investors are now wondering if the European Central Bank (ECB) might do the same. The ECB and SNB sometimes copy each other's decisions, although usually the SNB follows the ECB.
There isn't any important economic data coming out about the Eurozone this week, so there probably won't be many big changes in the exchange rate. Also, it's Easter holiday soon, which could mean less trading activity.
Euro stays strong despite calls for rate cuts
The Euro held its value even though some important people at the ECB said they think interest rates should be cut soon.
One ECB official said inflation is going down quickly and that most people at the ECB now agree to cut rates. This makes it more likely that the ECB will cut rates in June or even earlier. Lower rates would generally make the Euro less attractive to investors.
Another ECB official said he is confident that wages are not growing too quickly, which is another reason why the ECB might cut rates soon.
Short-term outlook for EUR/USD: Downward trend
In the short term, the Euro seems to be getting weaker against the Dollar. This is because the Euro has been making lower and lower prices recently. Investors often follow the trend, so this could mean more people will sell Euros in the coming days.
Note
Price may very likely move higher to imbalance above before dropping (see chart below). in any case, we will wait for confirmation of reversal to downside!
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