EUR/USD Daily Fundamental Forecast – April 06, 2017
EURUSD continues to trade within a tight range as it has been doing since the beginning of the week. Even the host of data that came in yesterday from the US could not do much in pushing the pair on either side though it has so far tested both the weekly range high and the low but neither of them have been broken so far. There will be some break in either direction during the course of the week, watch out for that as then there will be a run in that direction and it could be quick and it could be large.
Euro Looking at the Topside
Yesterday, the pair traded very tightly during the Asian and the European sessions in anticipation of the news later in the day from the US. The first news was in the form of the ADP employment report which came in at a much better than expected value of over 250K when less than 200K was expected. Though the figures from the previous month were revised lower, it still was a healthy over 250K average considering the last 2 months and this continued the trend of strong economic data from the US. This put the pair under pressure and it visited the lows of the weekly range near 1.0630 though it recovered slightly.
Then the next bigger piece of news was the FOMC meeting minutes. If late, these minutes have lost sheen as not much is said and hence not much is expected from the minutes. This minutes was more about the balance sheet and though it said that it was discussed, there was no mention of what was discussed, timelines etc. and hence there was not movement or volatility post the release in the EURUSD pair.
On the other hand, we had reports saying that there were serious concerns expressed by many House members over the new tax plans and hence the tax plan is expected to take much longer to get into the House for a vote than the new healthcare plan. This was a blow to Trump and his team and this has put the dollar under pressure and this helped the pair to recover towards 1.0680 where it trades as of this writing.
Looking ahead to the rest of the day, we have the unemployment claims data from the US and no major economic news from the Eurozone. We expect the dollar to be under pressure for the rest of the day which would mean that the EURUSD pair would be buoyant and the range high could be under threat during the course of the day.