EUR/USD Fundamental Analysis: April 6, 2017
The EUR/USD pair is yet again trapped within a very limited trading range, which has been the pair’s dominant trend ever since the start of the week. The slew of economic data from the US economy did little to push the currency pair through its current range, although it has tested both barriers but has not yet come close to breaking through this particular range. However, the market is expecting the currency pair to make a breakthrough anytime within this week, and a break in any direction is expected to be very large-scale, with runs possibly occurring.
The EUR/USD pair traded tightly during the Tokyo and London sessions yesterday as it awaited for the release of economic data from the US. The ADP employment report was the first to come out, with the said data exceeding initial market expectations of less than 200K after it came out at 250K. Although last month’s reading was revised as a result, 250K is still a very strong average if we take into consideration the reading for the two previous months. This also marked the continuation of a steady stream of positive data from the US economy. In addition, this also put the EUR/USD pair under pressure and tested its range lows of 1.0630 although it made a small recovery towards the end of the session.
Next up was the release of the FOMC meeting minutes, which was very lackluster as it did not contain any relevant information for traders. The said minutes contained only balance sheet discussions and did not induce enough volatility for the EUR/USD pair. The USD was also put under pressure as the majority of House members expressed major uncertainties with regards to Trump’s tax plans, and this has helped the EUR/USD to recover towards 1.0680 points.
For today’s session, there are no major news releases from the EU economy although the US will be releasing its unemployment claims data. The USD is expected to remain under pressure for the duration of today’s session, with the EUR/USD remaining afloat and could possibly break through its range highs at any point within today’s session.