Fundamental view:

The Euro rose against the greenback this week after a fall of last week. The Consumer Price Index was confirmed at 7% YoY in December, its highest since 1982. The high inflation due to disruptions in supply chain as pandemic blew in the year beginning caused the inflation to rise which in turn forces the Central bankers to tighten their monetary policies, despite the progress in the economic recovery was away from being complete. European policymakers maintain their wait-and-see stance. President of European Central Bank Christine Lagarde said they understand that rising prices are a concern for many people and noted that they take this concern very seriously, She said “people can trust that our commitment to price stability is unwavering, which is critical for the firm anchoring of inflation expectations and for confidence in the currency.” The Inflation along with the other catalyst underpinned bullish trend for the quote.

In this week, US Federal Budget Balance on 12^th January and Eurozone Trade Balance on 14^th January favored downtrend whereas Eurozone Unemployment Rate on 10th January, US CPI monthly report on 12^th January and US PPI monthly report on 13^th January favored uptrend for the pair.

The major economic events deciding the movement of the pair in the next week are Eurozone ZEW Economic Sentiment Indicator, US TIC Net Long-Term Transactions at Jan 18, US Building Permits at Jan 19, ECB Monetary Policy Meeting Accounts, Initial Jobless Claims, EIA Crude Oil Stocks Change at Jan 20 and Baker Hughes US Oil Rig Count at Jan 21.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.91% higher than the previous week. Maintaining high at 1.1482 and low at 1.1284 showed a movement of 198 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 upside. A solid breakout above 1.1499 may open a clean path towards 1.1589 and may take a way up to 1.1697. Should 1.1301 prove to be unreliable support, the EURUSD may sink downwards 1.1193 and 1.1103 respectively. Chart formation of a Semi-w pattern breakout in H4 chart sets prospects for a bullish trend. Three outside down formation in H4 chart escalates the expectation for a bullish trend.