Fundamental view:

Euro plummeted against the greenback during this week due to the risk sentiment amidst Ukraine crisis.

Concerns over Russia – Ukraine tussle eased temporarily during mid week as Kyiv put a diplomatic solution on the table, but of no use. Market stayed under pressure most of the week, However, it got a positive turn on Friday after Russian President Vladimir Putin said that “there were certain positive shifts” in negotiations with Ukraine. Whereas President Volodymyr Zelenskyy said that it would take time and patience to achieve victory.  

The ECB meet the expectation by keeping the interest rates unchanged, However the central bank announced it would end the Asset Purchase Program in the third quarter of the year, sooner than anticipated. On the other hand, The Consumer Price Index of US soared to 7.9% YoY as expected, but still a multi-decade high and The central bank is expected to raise interest rates for the first time since 2018, and policymakers will likely hint at a faster pace of hikes in 2022.

In this week, Eurozone Retail sales monthly report on 7^th March and US initial Jobless claim on 10^th March favored the bullish trend whereas Eurozone Industrial Production monthly report on 9^th March and US CPI monthly report on 10^th March favored the bearish trend for the pair.

The major economic events deciding the movement of the pair in the next week are Eurozone Industrial Production monthly report at Mar 14, Eurozone ZEW Economic Sentiment Indicator, NY Fed Empire State Manufacturing Index at Mar 15, US Retail Sales monthly report, Fed Interest Rate Decision at Mar 16, Initial Jobless Claims, US Fed Industrial Production yearly report at Mar 17 and Fed Governor Bowman Speech at Mar 18.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 1.11% lower than the previous week. Maintaining high at 1.1121 and low at 1.0806 showed a movement of 315 pips.

In the upcoming week we expect EUR/USD to show a bearish trend. The currency pair is trading below the 200 Simple Moving Average and the MACD trades to the downside. Should 1.0769 proves to be unreliable support then the pair may fall further to 1.0630 and 1.0454 respectively whereas a solid breakout above 1.1084 will open a clear path upward to 1.1260 and then will further raise up to 1.1399. Chart formation of a bearish pennant pattern in H4 chart sets prospects for a bearish trend. Bearish engulfing formation in H4 chart escalates the expectation for a bearish trend.