EUR/USD Daily Fundamental Forecast – July 5, 2017
The EURUSD pair continued to fall during the course of the day yesterday as the dollar continued to hold its fort and recover across the board. It was a holiday in the US yesterday on account of Independence day but for those dollar bulls who expected it to be a day when they could overturn the dollar recovery, it was a disappointing day in general.
EUR/USD Likely to be Under Pressure
The market saw some low volatility and liquidity during the course of the day on account of the US holiday but even the little action that we saw yesterday was enough to show that the dollar continues to remain strong and it is likely to continue to be so as the traders and investors wait in anticipation of greater action in the form of economic events and data in the second half of the week. This is the main reason for the recovery in the dollar as there has not been much fundamental change since last week.
We have the FOMC minutes later on in the day where the market will come to know about the voting pattern for the rate hike and would also come to know about what the members thought about the economic and monetary policy. The traders would also be looking for hints on the timeline for the next rate hike though we believe that the Fed would leave it open ended and say that it is dependent on incoming data, as it normally does.
As mentioned earlier, there was not much movement and the pair dropped below the 1.1350 region for a brief while before it recovered quickly to trade above it. Looking ahead to the rest of the day, we have the PMI data from the different countries of Europe, including Germany, but the bigger market mover would be the FOMC meeting minutes which could strengthen the dollar even further which would then push the EURUSD pair towards the 1.13 mark where it is likely to find some strong support.
This article was originally posted on FX Empire