Yahoo Finance EUR/USD Daily Fundamental Forecast – January 18, 2018
The choppiness in the EURUSD pair continues as the pair moves between 1.22 and 1.23 with no specific direction. Yesterday, we saw the pair moving higher during the first half of the day and for sometime, it appeared that the day would be another rout for the dollar. But that changed towards the end of the day as the dollar recovered back some of its strength.
EURUSD Breaks Through 1.22
The euro has also been growing stronger over the last week or so. Though the euro has been moving higher against the dollar over the last month, it was more due to the weakness in the dollar rather than the strength in the euro. It was only in the last week or so that the euro began to strengthen on its own as the ECB indicated that it is looking to taper and complete the QE by the end of this year. This helped the euro immensely and it managed to move higher. It seemed to be a continuation of this move during the first half of yesterday as the prices made a beeline towards the 1.23 region.
But this move reversed during the later half of the day as the ECB seemed a bit ruffled by the quick rise in the euro and sought to dumb down the rise by issuing statements and assurances that the QE would continue as per normal levels for now. It is obvious from their stances and also from the incoming data that the QE would come to an end but the ECB would prefer the euro to strengthen gradually. This helped the euro to move lower and then as the US session progressed, the dollar also managed to make some progress, which pushed the pair below 1.22 where it continues to trade as of this writing.
Looking ahead to the rest of the day, we do not have any major news from the US or the Eurozone and so expect the choppiness to continue for the day. We should see some support in the 1.2180 region followed by some more support in the 1.21 region.
This article was originally posted on FX Empire
