Listen to the latest market mood for the EURUSD pair.
Strong EUR, Weak USD
The European Recovery Fund has been taken by the market as a very positive sign on European solidarity. As a result, the chances of the eurozone breaking up are now reduced as the nations pull together to support the economy via the fund.
There is also another dynamic currently at play which is that Europe has falling COVID-19 cases while the US has rising case numbers. As a result, the outlook for the EUR vs the USD looks stronger over the short to medium term. As a result, expect EURUSD buyers on pullbacks to 1.1400 this week.
Swing trade outlook – We expect this trade to play out over the next 2-3 days.
- If there is a very strong risk-off sentiment that comes into the market expect USD strength and EURUSD downside.
- If Europe’s COVID-19 case count starts to rise rapidly this will also invalidate this outlook.
- A good treatment that minimises the risk of COVID-19 will also invalidate this outlook.