FXTM information and reviews
OctaFX information and reviews
XM information and reviews
FXCC information and reviews
FxPro information and reviews
HFM information and reviews

Euro's fortunes set to reverse?

13 April 2021 Written by Hussein Al Sayed  Chief Market Strategist at Exinity Group (Gulf & MENA) Hussein Sayed

The euro has seen a recovery of late, strengthening against most of its G10 peers so far this month except for versus the Swiss Franc and the Swedish Krona. Such a performance is reflected in the EUR index climbing by more than one percent on a month-to-date basis. This is an equally-weighted index, comprising the following currency pairs:

A couple of key technical events have transpired of late that should form a more solid base for this index to climb higher.

Firstly, prices have formed a higher high and have breached its 50-day simple moving average (SMA). Meanwhile, its MACD has recently moved above the base line of 0. A sustained break above the 1.3210 line, which was the resistance level form early March and also the support level for some early February price action, could ultimately lead the EUR index to the 1.3277 mark. Otherwise, a break back below its 50-SMA could open a path back towards the 1.3100 mark.

Euro’s fate depends on key data

The euro has been able to hold on to recent gains, following its better-than-expected February retail sales data that was announced yesterday. It rose by 3% compared to January, beating estimates of 1.7%. The year-on-year figure shrank by 2.9%, which is still better than the 5.3% decline that markets had expected. Both the month-on-month and year-on-year prints also fared better than January’s figures.

Investors will have to several key events to monitor over the coming days that could determine the shared currency’s performance over the course of the week:

Tuesday, April 13

Friday, April 16

Euro’s outlook mixed

Intriguingly, the 25 delta risk reversals show that markets are bullish on the euro’s performance against all other G10 currencies, except against the Japanese Yen, for the next 2-month period. Meanwhile, the latest data from the CFTC (Commodity Futures Trading Commission) for the week of April 6 shows a mixed outlook for the euro. Leveraged funds have raised their net-short positions on the euro to the highest since July. On the other hand, asset managers have increased their net euro longs to reverse two consecutive weeks of paring back such positions.

Note that the EU recovery fund that’s worth 750 billion euros is due to course its way through the bloc in the middle of this year, once it is ratified by member countries. Such financial aid is set to offer more help to the continent’s recovery into the post-pandemic era.

Until then, it is imperative that the continent has a firm grip on the pandemic and gets its vaccination drive back on track to catch up with the inoculation rates seen in the UK and the US. That could form the basis for its economic recovery which could then translate into a sustained rebound for the euro.


Share: Tweet this or Share on Facebook


Dollar flat as market braces for central bank decisions later in the week
Dollar flat as market braces for central bank decisions later in the week

The dollar was up modestly in early trading in Europe on Monday, at the start of a key week for central bank meetings on both sides of the Atlantic. By 03:00 ET (08:00 GMT), the dollar index...

30 Jan 2023

Mega Central banks, OPEC, NFP & Earnings week
Mega Central banks, OPEC, NFP & Earnings week

China Stock market returns from Luna New Year break. Chinese stocks rose while most other Asian equities fell as investors looked to interest rate decisions scheduled this week in the US...

30 Jan 2023

XAU/USD remains on the defensive around $1,925 ahead of US PCE
XAU/USD remains on the defensive around $1,925 ahead of US PCE

Gold price remains on the defensive for the second straight day amid modest US Dollar strength. Thursday’s upbeat US macro data fuels hawkish Fed expectations...

27 Jan 2023

XAU/USD retreats from multi-month top amid modest USD recovery, ahead of US GDP
XAU/USD retreats from multi-month top amid modest USD recovery, ahead of US GDP

Gold price pulls away from a fresh multi-month top amid a modest US Dollar strength. Bets for smaller rate hikes by Federal Reserve, recession fears should help limit losses...

26 Jan 2023

Microsoft: Still Trapped Within Descending Channel
Microsoft: Still Trapped Within Descending Channel

Microsoft Corp., an American multinational technology conglomerate currently ranked the third largest company by market capitalization ($1.728T) which actively engages...

24 Jan 2023

Same story new week
Same story new week

Chinese New Year celebrations – many centres are closed in Asia. Treasuries sagged to end on a bearish week. USDIndex at 101.30 low as the market continued...

23 Jan 2023

Editors' Picks

FXCM information and reviews
ActivTrades information and reviews
RoboForex information and reviews
MultiBank Group information and reviews
MultiBank Group
Libertex information and reviews
Vantage information and reviews

© 2006-2023 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.