Fundamental view:

Euro fell against greenback in the past week. The US currency received an initial support from the Federal Reserve. Officials did not agree that they intend to taper their bond-buying scheme – but merely talking about rosier forecasts supported yields and the greenback. Jerome Powell, Chairman of the Federal Reserve, seemed to put an end to speculation by rejecting any tightening in the foreseeable future. In the meantime, corona virus has continued raging on both sides of the Atlantic. The daily death toll of US advanced after surpassing the 4,000 mark, while Germany extended its lockdown amid rising mortalities and no relenting in infections.

US NFIB Small Business Optimism on 12^th January and US CPI yearly report on 13^th January created uptrend for the pair whereas Europe Industrial Production yearly report on 11^th January and Europe Retail Sales yearly report created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are Europe ZEW Economic Sentiment Indicator, US TIC Net Long-Term Transactions at Jan 19, ECB Interest Rate Decision, US Building Permits, Philadelphia Fed Manufacturing Index, US Initial Jobless Claims at Jan 21, and US Markit Manufacturing PMI at Jan 22.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 1.03% lower than the previous week. Maintaining high at 1.2223 and low at 1.2075 showed a movement of 148 pips.

In the upcoming week we expect EUR/USD to show a bullish trend. The currency pair is trading below the 100 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1.2176 may open a clean path towards 1.2273 and may take a way up to 1.2323. Should 1.2028 prove to be unreliable support, the EURUSD may sink downwards 1.1977 and 1.1880 respectively. Chart formation of a deep crap pattern in H4 chart sets prospects for a bullish trend. Hammer formation in H4 chart escalates the expectation for a bullish trend.