Fundamental view:

EUR seemed to be stronger than the greenback in the past week. The greenback retains the doubtful honor of being the weakest currency across the FX board, undermined by mounting virus concerns, but also but resurgent demand for the pound after the UK Parliament backed the post-Brexit deal. The EU hasn’t published macroeconomic data while the US has just released Initial Jobless Claims for the week ended December 25, which came in at 787K against the 833K expected. Wall Street is poised to open with losses, following the lead of its European counterparts. 

In the past week, Europe Jobseekers Total on 28^th Dec and US Initial Jobless Claims & US Continuing Jobless Claims on 31^st Dec created a bearish trend for the pair whereas US S&P/CS HPI Composite-20 s.a. m/m & US Dallas Fed Services Business Activity on 29^th Dec and Europe HICP y/y & Europe Current Account on 30^th Dec created bullish trend.

The major economic events deciding the movement of the pair in the next week are Euro Markit Manufacturing PMI, OPEC Meeting at Jan 04, Euro Unemployment Change, US ISM Manufacturing PMI at Jan 05, US ADP Nonfarm Employment Change at Jan 06, US Initial Jobless Claims, US ISM Non-Manufacturing PMI at Jan 07, and US Nonfarm Payrolls at Jan 08.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.43% higher than the previous week. Maintaining high at 1.2310 and low at 1.2179 showed a movement of 131 pips.

In the upcoming week we expect EUR/USD to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the downside. A solid breakout above 1.2290 may open a clean path towards 1.2365 and may take a way up to 1.2421. Should 1.2159 prove to be unreliable support, the EURUSD may sink downwards 1.2103 and 1.2028 respectively. Chart formation of a Bullish butterfly pattern in H4 chart sets prospects for a bullish trend. Hammer formation in H4 chart escalates the expectation for a bullish trend.