FOREX Fundamental analysis for EUR/USD on June 6, 2024
82 experts polled by Reuters predict that the ECB will reduce the deposit rate from 4% to 3.75% at its meeting on June 6. However, not everyone considers this decision to be successful. Algebris Investments calls it a political mistake, and JP Morgan calls the actions of the Central Bank too hasty. The ECB joins the regulators of Switzerland, Sweden and Canada, which have already begun cycles of monetary expansion. However, unlike the Swiss franc and the Swedish krona, the euro continues to strengthen against the dollar.
The history of rate cuts by Central banks is most often triggered by a slowdown in the economy. After the collapse of Lehman Brothers in 2008, the ECB eased monetary policy to prevent the outbreak of the crisis. In 2011, when Greece was on the verge of bankruptcy and in 2019, rates were lowered due to slowing GDP growth and falling inflation. But the situation in 2024 is different — the Eurozone economy is showing growth.
Analysts believe that the ECB is lowering rates mainly because of the promise made at the previous meeting, where a compromise was reached between the "doves" and "hawks" on the June easing of monetary policy. This promise, together with a strong labor market and rising real incomes, has become one of the factors driving the rise in Eurozone GDP. It has also helped to reduce the cost of mortgage and corporate loans.
It is logical that Bloomberg predicts a revision of forecasts for eurozone GDP at the June ECB meeting with an increase. If the Central Bank adjusts the forecast for core inflation in the same direction, we will receive a signal that a further reduction in the deposit rate is unlikely. And this is already a catalyst for the growth of EUR/USD.
Christine Lagarde's team contributed to the improvement of the Eurozone economy, which had a positive effect on the euro exchange rate. In 2023, European GDP grew by 0.4%, while American GDP increased by 2.5%. According to purchasing managers' indices, both indicators may strengthen by 1.3% in the second quarter. BNP Paribas believes that the peak of the discrepancy in growth rates between the United States and Europe is already over. This means that EUR/USD is unlikely to return to the 1.06 mark in the coming months, if not years.
The 25th record high of the S&P 500 and the fall in US Treasury bond yields to the lowest values in two months create favorable conditions for the growth of EUR/USD. However, forex currency trading is not without its shocks. Thus, political events, including the US presidential election, can change the balance of power. Nevertheless, investors' attention is focused on the rhetoric of Christine Lagarde, who is expected to hint at future ECB actions.
Taking into account the improvement in forecasts for GDP and inflation in the Eurozone, as well as statements about a gradual easing of the ECB's monetary policy, EUR/USD is likely to continue its rally towards 1.108. A break in the resistance at 1.0905 and 1.0915 will be a reason to build up long positions.
EUR/USD Technical analysis for EUR/USD
Yesterday, EUR/USD tried to break through the support area of 1.0874 - 1.0869, but the attempts of the "bears" were unsuccessful. Buyers were able to defend the area, after which the short-term uptrend continued. Buyers have worked out the first target in the area of the 1.0893 level. The next target for the pair is the maximum from June 4th. If the asset manages to break through the resistance and gain a foothold higher, then the target moves to the "Golden Zone" in the range of 1.0945 - 1.0937.
However, if the support area 1.0874 - 1.0869 is broken down on Thursday, the correction will continue to the support range 1.0832 - 1.0823. This zone is one of the key levels, so after testing it, it will be possible to start forming long positions.
AUD/USD analysis on January 24, 2025On Friday, AUD/USD continues to adjust upwards and is trading around 0.6315, showing moderate growth against the background of the weakening of the US currency.The Australian dollar remains neutral after the release of key macroeconomic data. In December, the index of business activity in the Australian manufacturing sector rose from 47.8 to 49.8, but still remains below the stagnation level (50 points), indicating a slowdown in the recession. In the services sector, the index dropped from 50.8 to 50.4, confirming the weak growth that has been observed over the past four months.Analysts at Bank of America Corp. Inflation is forecast to slow down in Australia in the fourth quarter. According to preliminary estimates, the consumer price index may grow by only 0.2% on a monthly basis, which will lead to a decrease in the annual value from 2.8% to 2.3%. The main factor in slowing down inflation remains the reduction in the cost of electricity.The US Dollar Index (USDX) is trading at 107.50, well below its annual high of 109.60. Investors' attention has shifted to the US labor market.Initial applications for unemployment benefits increased from 217,000 to 223,000 in a week.The total number of applications increased from 1,853 million to 1,899 million.Despite the inauguration of Donald Trump as president of the United States, there have been no significant changes in economic policy so far, which increases uncertainty in the market.AUD/USD Technical Analysis for todayOn the daily chart, the pair is trying to exit the descending channel with dynamic boundaries of 0.6280–0.6150.Technical indicators signal a possible increase:The EMA lines of the Alligator indicator are pointing up and approaching the signal line.The Awesome Oscillator indicator (AO) is approaching the transition to a positive zone.Trading RecommendationsLong positions: it is recommended to open when the price breaks and fixes above the level of 0.6350 with a target of 0.6450. Set the stop loss at 0.6300. Implementation period: 7 days or more.Short positions: possible when the level of 0.6280 breaks down with a target of 0.6150. The stop loss is 0.6350.The current dynamics indicate that the market is ready for a possible trend reversal, which makes technical levels key for determining the further direction of the pair's movement. 
The USD/JPY pair found strong support at 154.80, after which it was able to turn around and break through the important pivot resistance levels of 155.50 and 155.80, gaining a foothold in the uptrend zone.On the 4-hour chart, it is noticeable that the pair overcame the 38.2% Fibonacci retracement level from a downward movement from a high of 158.87 to a low of 154.77. Quotes also broke through the 200-period simple moving average (green line) and approached the 100-period moving average (red line), which underlines the growing bullish momentum.Resistance levelsAt the moment, the pair is facing the first significant obstacle in the area of 156.80, which coincides with the 50% Fibonacci retracement level from the aforementioned downward movement.The next key resistance is at 157.30. A confident breakdown of this level can set the direction for further growth and allow the pair to reach resistance at 158.00. Consolidation above the last level will create conditions for the continuation of the uptrend.Support levelsThe nearest support for the pair is located near the level of 155.80. In case of further decline, the 155.50 zone will become the next key support level. If sellers overcome this mark, USD/JPY may fall to 155.00, which will increase the downward pressure.ConclusionsThe USD/JPY pair is showing a steady upward trend, but further movement depends on the ability to break through resistance at the levels of 156.80 and 157.30. In the event of a correction, market participants' attention is focused on the key supports of 155.80 and 155.50, which will determine the likelihood of a deepening pullback. 
In Friday morning trading, USD/CAD shows a moderate decline, regaining some of yesterday's strengthening. The quotes have gone down to 1.4335 and are testing the level for a downward breakout. Market participants are focused on the upcoming macroeconomic statistics releases from the United States.Today at 16:45 (GMT+2), investors' attention will be focused on the S&P Global business activity indices for January. A moderate correction from 49.4 to 49.6 points is expected in the manufacturing sector, while a decrease from 56.8 to 56.5 points is expected in the services sector. These data are unlikely to have a significant impact on the US dollar. Additionally, the University of Michigan Consumer Confidence Index will be published at 17:00 (GMT+2). The forecast is 73.2 points.The impact of monetary policyTraders' main focus is on the actions of Central Banks. Next Wednesday at 21:00 (GMT+2). The US Federal Reserve System (Fed) will announce the decision on the interest rate. Most market participants do not expect changes in the monetary policy rate, but the regulator's comments may set the tone for the dollar.At the same time, the Bank of Canada, whose meeting is scheduled for today at 16:45 (GMT+2), may decide to reduce the key interest rate by 25 basis points. This move will put pressure on the Canadian dollar. Weak macroeconomic indicators indicate the likelihood of such a scenario. In December, the consumer price index in Canada slowed from 1.9% to 1.8% in annual terms, and the monthly value decreased from 0.0% to -0.4%. Retail sales data for November also turned out to be worse than expected: the overall figure remained unchanged, while sales excluding cars decreased by 0.7%, instead of the projected 0.1% increase.USD/CAD technical Analysis for todayOn the daily chart, the Bollinger indicator indicates a flat, but the price range remains wide enough to match the current market volatility. The MACD continues to decline, maintaining the sell signal — the histogram remains below the signal line. Stochastic stabilized at the "20" mark, signaling a possible oversold pair in the short term.Trading Recommendations1. Sale:Open positions after the breakdown of the 1.4300 level downwards.Target is 1.4200.Stop loss is 1.4350.2. Buy:Consider long positions after a rebound from the 1.4300 level and a breakdown of resistance at 1.4350.Target is 1.4435.Stop loss is 1.4300.The current dynamics of the USD/CAD pair indicates the need for careful monitoring of the news background and monetary decisions of Central Banks, as they remain the main drivers of the exchange rate movement. 
FOREX fundamental analysis for EUR/USD on January 24, 2025When the EUR/USD exchange rate depends solely on the rhetoric of the US president, the volatility of currency pairs is inevitable. Morgan Stanley analysts note that there are still enough "bulls" for the dollar in Forex, but their positions are starting to weaken. The reason is the slowdown in inflation, which may prompt the Federal Reserve to lower interest rates. In addition, the lack of progress in fiscal negotiations in Congress and a softer US trade policy also threaten the dollar's position. However, the dollar needs a trigger, and recently this role has been played by Donald Trump's statements.Davos and Trump's ambitionsAt the World Economic Forum in Davos, the US president stressed that businesses should produce products in America, promising the lowest tax rates in the world for those who fulfill this condition. Otherwise, according to him, tariffs will follow. In addition, he demanded that OPEC lower oil prices, arguing that this would slow down inflation.Donald Trump attributes lower energy prices to lower inflation, arguing that this will create conditions for lower Fed rates. Although energy resources did make a significant contribution to the growth of the PCE price index in 2024 (by 40%), core inflation remains above 3%. According to forecasts by Wall Street Journal experts, the inflation rate in 2025 may rise to 2.7%, due to the pro-inflationary policy of the Trump administration.Global risk appetite and EUR/USD movementTrump's harsh statements about oil and ending the conflict in Ukraine have caused a surge of optimism in global stock markets. US indices have reached new historical highs, and global risk appetite has supported EUR/USD.The US president also stated his commitment to ending the armed conflict in Ukraine, emphasizing the role of OPEC, which, according to him, hinders the achievement of peace by its actions. If the situation in Eastern Europe stabilizes, this could be a significant factor in strengthening the euro. Recall that in 2022, the EUR/USD exchange rate fell below parity due to the energy crisis in Europe. The resumption of gas supplies and lower prices could stimulate the economic recovery of the Eurozone.The euro was also supported by Trump's words that he does not seek to impose new tariffs against China, noting that he has "always had good relations" with Xi Jinping. However, investors remember how in 2018-2019, similar comments by the US president were accompanied by the imposition of duties.EUR/USD technical analysisEUR/USD is growing and approaching the maximum on January 22. If the quotes consolidate above the extreme, then buyers will try to break through the Target zone of 1.0481 - 1.0453. If successful, the growth will continue to the Golden zone of 1.0554 - 1.0545.We will open new purchases in the uptrend format on a corrective decline to the support areas of 1.0365 - 1.0356 and 1.0319 - 1.0305. The main target of buyers will be the maximum on January 22.Forecast and trading strategy for EUR/USDReactions to Donald Trump's statements are difficult to predict due to his volatile rhetoric, but markets continue to adapt. Expectations for a Fed rate cut remain moderate, and an end to the conflict in Ukraine and lower oil prices still look like long-term prospects.Trading PlanOur forex trading strategies give preference to EUR/USD sales on any corrective growth. Optimal levels for forming short positions:• 1,047• 1,054 
AUD/USD analysis on January 23, 2025AUD/USD is showing moderate growth and remains in the area of local highs on January 6 near the 0.6300 mark. The main impulse of the upward movement occurred on January 20, when the inauguration of Donald Trump provoked a surge in currency pair volatility in the market.Investors are closely monitoring the possible implementation of the US president's trade promises, including the imposition of import duties. Although Trump did not disclose details of changes to trade agreements in his speech, information later emerged about possible tariffs of 25% on goods from Canada and Mexico starting February 1, as well as 10% duties on Chinese imports. Experts suggest that the announced measures may put significant pressure on the economies of these countries. According to calculations, China's GDP could shrink by $128 billion, and the U.S. economy will lose about $55 billion over four years.Today, the focus of American traders will be on data on applications for unemployment benefits, which will be published at 15:30 (GMT+2). A slight increase in initial applications is projected for the week from 217 thousand to 220 thousand, and repeat applications from 1,859 million to 1,860 million.Tomorrow, the market is waiting for the publication of business activity indices from S&P Global for January:Manufacturing sector: expected to grow from 49.4 to 49.6 points.The service sector: a decline from 56.8 to 56.5 points is forecast.Similar indexes in Australia will be released on Friday. According to preliminary data:Manufacturing industry: 47.8 points (unchanged).Service sector: 50.8 points (stable).Last week, data on the Australian labor market showed that:The unemployment rate decreased by 4 thousand to 604.9 thousand people.The number of employees increased by 31 thousand to 14.573 million, which is 2.8% more than a year ago.The employment rate remained at 64.4%, despite a decrease in full-time employment by 23.7 thousand to 10.037 million, and partial employment by 80 thousand to 4.546 million.The labor market is showing resilience even against the backdrop of high interest rates, which may support the prospects for the Australian dollar.AUD/USD Technical Analysis for todayOn the daily chart, the Bollinger Band Indicator is trying to stabilize in the horizontal plane, which indicates a possible slowdown in the current uptrend. The MACD histogram is growing, forming a buy signal, which confirms the upward momentum. Stochastic is above the "80" mark and signals that the pair is overbought, which creates correction risks in the short term.Trading Recommendations1. SaleCondition: A confident breakdown of the 0.6250 level down.Target: 0.6200.Stop loss: 0.6274.2. BuyCondition: Breakout of the 0.6300 mark up.Target: 0.6372.Stop loss: 0.6274.The attention of market participants in the coming days is focused on the economic data from the United States and Australia, which may set a new impetus for the AUD/USD pair. 
The EUR/GBP exchange rate showed stability against the background of the publication of data on the UK labor market.Although wage growth (excluding bonuses) exceeded expectations, a more important indicator is the monthly wage dynamics in the private sector, which is closely monitored by the Bank of England (BoE), showed less pronounced growth.This indicates a gradual cooling of the labor market, which is consistent with the latest BoE survey, according to which wage growth expectations have dropped below 4%.These data did not significantly change the outlook for the Bank of England's monetary policy. The probability of an interest rate cut in February remains high. In the short term, the EUR/GBP pair may continue to grow, given the risks associated with high borrowing rates in the UK, as well as expectations of further easing of BoE policy. At the same time, the euro may receive support by reducing fears of the introduction of US customs tariffs against the EU.EUR/GBP technical analysis for todayDaily timeframe (D1)On the daily chart, the EUR/GBP pair rebounded from the key resistance zone after collecting liquidity above previous highs. However, the current situation is not clear enough to form a clear market trend. For confirmation, it is necessary to switch to the lower timeframe in order to analyze the price behavior.Timeframe 3 hours (H3)The 3-hour chart shows the formation of an important trend change pattern - the breakdown of the trend line and the subsequent retest. The price reaction from the resistance zone of the daily chart led to a breakdown of the trend line, which previously supported the upward movement. Repeated testing of a broken trendline usually indicates the beginning of a reversal, which confirms the predominance of bearish sentiment in the market.Conclusions• Direction: Downward• Target level: 0.84983• Scenario cancellation rate: 0.83065RecommendationThe current market structure and signs of a slowdown in the UK economy, coupled with the main forex indicators, indicate the potential for further depreciation of the EUR/GBP exchange rate. Opening short positions with a target at 0.84983 may be justified if the bearish trend is confirmed. 
FOREX fundamental analysis for EUR/USD on January 23, 2025In the historical context, the success of the US economy has often had a positive impact on the global market. However, 2025 shows a completely different picture. The strong American economy, which previously pushed the development of exporters from other countries, is facing the intention of Donald Trump to redraw the global trade map. The US president is threatening to impose 25% duties on imports from Canada and Mexico, 10% tariffs against China and publicly criticizes the European Union, accusing it of a trade surplus with the United States worth $350 billion, which, according to the White House, implies an adjustment of the trade agreement between the partners, the threat of tariff revision has become one. one of the reasons holding back the EUR/USD recovery, despite attempts to develop an upward movement.The state of the Eurozone economyThe head of the Bank of the Netherlands, Claes Knoth, noted that the problem is not only the negative impact of tariffs on the Eurozone's GDP, but also the general weakness of the region's economy. Against the background of these factors, the European Central Bank (ECB) is set to continue the cycle of monetary policy easing. According to market expectations, in January and March, the ECB may reduce the deposit rate from 3% to 2.5%, and by 2025 it may drop to 2%. ECB representatives from France and Greece agree with this forecast, pointing to a steady slowdown in inflation towards the 2% target.Donald Trump's policy and its impact on the foreign exchange marketPresident Trump is pursuing an economic policy that, according to analysts, is inflationary in nature. Tariff increases, deregulation, and increased fiscal stimulus could put pressure on the Fed and force it to tighten monetary policy. Meanwhile, ECB President Christine Lagarde noted that the impact of factors such as Trump's tariffs would have a greater impact on the Federal Reserve than on the Eurozone economy. While the United States faces the risk of accelerating inflation, the ECB is recording disinflationary trends.According to analysts at ABP Invest, the Fed is likely to raise the federal funds rate as early as September. The reasons will be strong economic growth in the United States, accelerating inflation and the need to maintain confidence in the regulator. At the first stage, the Fed will prefer to monitor the situation, then, in the second quarter, it will begin to give "hawkish" signals and in the third it will take action. Such a divergence in monetary policy between the United States and the Eurozone may be a key factor in the decline of the EUR/USD exchange rate.Trading recommendations for EUR/USDThe current downtrend for EUR/USD remains in effect. The bulls' attempts to overcome the resistance at 1,045 were unsuccessful, which allowed traders to activate short positions. If the pair breaks the 1.039 mark, it will generate additional signals to strengthen the shorts, with the potential for further depreciation below the parity level.Against the background of the general weakness of the Eurozone, the divergence of US and EU monetary policies, as well as the pressure of US trade policy, EUR/USD remains under pressure. Sales at the breakdown of key support levels look the most promising.EUR/USD technical analysisYesterday, in the short-term uptrend format, EUR/USD reached the upper Target zone of 1.0481 - 1.0453. After that, a downward correction began. The possible target of the corrective decline is the support area 1.0365 - 1.0356. After testing the support, we will consider new purchases with the first target at 1.0406, the second target is yesterday's maximum.The key trend support is shifting to 1.0319 - 1.0305. If this zone is reached during trading, then purchases can also be considered from it. 
Focus of attention: the first week of the Trump presidencyMarkets continue to closely monitor the actions of Donald Trump in his first week as president of the United States. He is expected to sign a number of decrees, strengthening the political dynamics. These events continue to dominate the news agenda, leaving investors and world leaders to analyze the consequences of the 47th president's decisions.President Trump spoke for the first time about the conflict in Ukraine, calling on Russian President Vladimir Putin to reach an agreement, threatening to increase sanctions. Trump also suspended the financing of "green" infrastructure worth more than $ 300 billion and announced plans to attract $ 500 billion in private investment in the development of artificial intelligence. In addition, he announced possible 10% customs duties on Chinese imports and new tariffs for the EU, citing an "alarming" trade surplus of $350 billion.Key economic dataEurozoneConsumer confidence data for January will be released on Thursday. After two years of growth, this indicator decreased in November and December. Given that private consumption is the main driver of economic growth in the Eurozone in 2025, the state of consumer sentiment will be an important factor for economic forecasts.NorwayNorges Bank is expected to keep the key rate at 4.5%, with a hint of a reduction in March. Core inflation figures for December, which showed a decrease after the November jump, are likely to ease pressure on the Central Bank. However, global interest rates, the Norwegian krone (NOK) exchange rate and oil prices pose risks of a change in the December interest rate forecast. In the short term, Norges Bank is likely to take a cautious stance.JapanOn Thursday night, data on inflation (CPI) and business activity (PMI) for December will be released. Statistics are released on the eve of the Bank of Japan (BoJ) meeting. Preliminary information from Tokyo shows that inflationary pressures decreased in December. The economic recovery continues, and inflation is close to the target level. The BoJ is expected to raise the rate by 25 bps, which is already partially embedded in investors' expectations.Stock marketsDespite analysts' warnings about volatility during the inauguration, global stock indexes showed growth.The MSCI World Index has reached a new all-time high, marking a seven-day rally. Investors who reduced their risks before the inauguration could have missed out on a 4% gain, which is equivalent to a six-month return.• The Dow Jones rose 0.3%.• The S&P 500 gained 0.6%.• Nasdaq rose 1.3%.• The Russell 2000 declined 0.6%.There is a mixed trend in Asia this morning. Chinese stocks initially rose on the back of statements of market support, but later this effect weakened. Futures for the US and European indices also show a slight pullback.Debt marketThe movement in global bond yields was modest. In the US, yields on 2-year and 10-year bonds rose by several basis points. In Europe, yields on German 10-year Bunds have also slightly increased, while the spread between German and Italian bonds is approaching 100 bps, and French securities have stabilized around 70 bps.The foreign exchange marketAmid expectations of the decisions of Norges Bank and BoJ, NOK strengthened, while JPY weakened. The EUR/USD pair remains stable and is trading just above the 1.04 mark.Conclusions1. Focus on the United States: President Trump's political actions continue to have an impact on markets, especially on the currencies of countries with high trade turnover with the United States.2. Europe: Declining consumer confidence in the Eurozone may weaken the euro in the short term.3. Japan and Norway: The monetary policy of these countries will be a key driver for the movement of NOK and JPY.