Fundamental view:

The EUR/USD pair kick-started 2021 reaching a fresh multi-year high, as optimism continued to undermine the greenback. The dollar got to recover some ground ahead of the weekly close, but retains its intrinsic long-term weakness, as it latest advance seems a mere correction. Coronavirus immunization through different approved vaccines has seen a bumpy start in December, but it’s in progress. According to Bloomberg, which collects data from governmental sources, over 17.5 million doses have been applied globally, 6.25 million just in the US. 

In the past week, Europe Markit Manufacturing PMI & Europe Markit Manufacturing PMI on 4^th January and  Europe Consumer Confidence on 5^th January created bullish trend and Unemployment Rate on 5^th January and  Europe Consumer Price Expectations on 7^th January created bearish trend for the pair.

The major economic events deciding the movement of the pair in the next week are US JOLTS Job Openings at Jan 12, Europe Industrial Production monthly report, US CPI monthly report at Jan 13, US Initial Jobless Claims, ECB Monetary Policy Meeting Accounts, Fed Chair Powell Speaks at Jan 14, and US Retail Sales monthly report at Jan 15.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.32% higher than the previous week. Maintaining high at 1.2349 and low at 1.2193 showed a movement of 156 pips.

In the upcoming week we expect EUR/USD to show a bearish trend. The currency pair is trading below the 100 Simple Moving Average and the MACD trades to the downside. A solid breakout below 1.2156 may open a clean path towards 1.2096 and may take a way down to 1.2000. Should 1.2311 prove to be unreliable resistance, the EURUSD may raise upwards 1.2408 and 1.2467 respectively. Chart formation of a descending triangle breakout in H4 chart frames prospects for a bearish trend. Bearish engulfing formation in H4 chart escalates the expectation for a bearish trend.