Fundamental view:

Euro dropped against the US dollar but traded within a tight range during trading course of the week. Ukraine – Russia Saga was dominant factor in the financial market which also weighed on the perceived riskier asset Euro. During this week, Market sentiment was sour with multiple Russia – Ukraine headlines weighing on the market, finishing with week with Moscow announcing new drills on Saturday. Thus traders pulled back from the riskier assets and opted safe haven assets like gold keeping USD aside.

Meanwhile, US Federal Reserve officials are giving clues at upcoming rate hikes. The Federal Reserve released Minutes of the latest FOMC meeting on Wednesday, and the document portrayed that the policymakers are ready to rate hike and preparing for plans to reduce the balance sheet. However, Market expectation was not meet as voting members maintained a measured approach to monetary policy tightening. Dovish Fed weighed on the US dollar. This may be one of the key catalyst in making Euro trade in a tight range.

In this week, Eurozone CPI monthly report on 15th February and US Initial Jobless claims on 17^th February favored bullish trend whereas US PPI monthly report on 15^th February and Eurozone Trade Balance on 17^th February favored bearish trend for the quote.

The major economic events deciding the movement of the pair in the next week are Fed Governor Bowman Speech at Feb 21, Eurozone Ifo Business Climate, US CB Consumer Confidence Index at Feb 22, US GDP quarterly report, Initial Jobless Claims, EIA Crude Oil Stocks Change at Feb 24, Eurozone GDP quarterly report, US Core Durable Goods Orders monthly report and Michigan Consumer Sentiment at Feb 25.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.87% lower than the previous week. Maintaining high at 1.1395 and low at 1.1280 showed a movement of 115 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 1.1267 proves to be unreliable support then the pair may fall further to 1.1216 and 1.1152 respectively whereas a solid breakout above 1.1382 will open a clear path upward to 1.1446 and then will further raise up to 1.1497. Chart formation of a symmetrical triangle pattern breakout downside in H4 chart sets prospects for a bearish trend. Bearish engulfing formation in H4 chart escalates the expectation for a bearish trend.