Are we seeing the end of the USD correction? For a change, data coming out of the US was not all bad and the dollar had reasons to rise The result is a fresh surge of the greenback. For the euro, which continues being weighed down by QE, this means new falls. Also talks about Greece’s cash flow have a negative impact.
EUR/USD is hardly holding on to 1.08, basically erasing the gains for the week. We still have more important figures later in the day.
The pair began the week just above 1.08, but shot up and began a long battle around the round 1.10 level. A first attempt didn’t work but consequent moves sent it up to 1.1050. However, it was hard for the euro to hang on there.
Perhaps the latest trigger is a new fall in the price of oil: the black gold soared on the breakout of fighting in Yemen. However, it seems contained for now.
Data coming out of Europe is not first tier: German import prices beat expectations, but that’s not very important.
The big events come from the US:
- FOMC member Stanley Fischer is set to talk at 10:30 GMT. He is the Vice Chair and close to Yellen’s view.
- The final GDP read for the US fo Q4 2014 is published at 12:30 GMT. A small upgrade from 2.2% to 2.4% is on the cards.
- And just as the week ends, Fed Chair Janet Yellen will be speaking at 19:45 GMT. She is usually very careful, but could still rock the boat.
More:Â EURUSD Holds at Critical Resistance Printing a Sell Signal
1.0760 provides some support if the round level of 1.08 is breached. Further support awaits at 1.0650. 1.0850 is resistance, before 1.0910 and 1.10. Volatility has certainly been significant lately.
And here is how it looks on the chart:
