- Fundamental Analysis:
EURUSD underwent a week under heavy sell-off pressure, I have a feeling that investors sold whatever which belongs eurozone, and they might not stop sell eurozone asset unless there is a significant change, but for the being time,I don't think the change coud happen, and between choosing US asset and EZ asset, a kid also answers US asset is better.
I recap key events affecting to EURUSD last week:
- ECB decided to cut main interest rate by 10bp to 0.05% from 0.15% and pre-announced ABS purchase.
- Non-Farm Payroll report of BLS slumped to 142k from 212k, the first time NFP is below 200k for 5 months.
We know that ECB will provide more detail about ABS purchases next meeting of ECB, specificly investors want to know about the size of ABS purchases.From now to that moment, EUR could fall further,but everything is not easy as we think: Forex market is more complicated than we expect, and to understand this market, we need to consider a lot of factors.
Next week, there is no major economic data of both US and EZ, so the main force driving EURUSD absolutely comes from risk appetite and technical analysis. There are two valuable pieces of data are US Retail Sales and EZ Employment Change; however, I don't think those data would have significant impact on EURUSD.
I know surely that ECB is done for this year, they used all necessary weapons to help Eurozone escaping deflation and upcoming crisis. If those weapons couldn't save Eurozone, they have only one weapon on the table: Nuclear weapon with QE like US QE. However, before using nuclear weapon, they need time to evaluate and connsider the reaction of EZ economy to measures of ECB. Hence, economic data will decide the move of EUR, if data is negative, the possibility of QE increases, and EURUSD will fall further; otherwise, if data is positive, it means ECB is on the right way, and the fall of EURUSD could be released.
About USD,, I need to answer one question : Does NFP report last Friday stop the advance of USD ?. We saw USD lossed momentum after NFP was released, but after that, investor began to re-buy USD. US Stock fell after the news, but re-gain the loss quickly and turned back positive. Investors and traders claim that the pullback of NFP was just a correction after 5 consecutive months above 200k; with Consumder Confident, Consumer Sentiment, Durable Good Orders, and ISM PMI beat the Consensus ; this shows that US economy expands sustainably and exactly with FED expect. Hence, I don't think negative NFP could halt the rally of USD.
In Short, SELL EURUSD is a right choice, absolutely BEARISH TREND. The problem is where is the entry point and stop loss as well as take profit. I go to detail in Technical Analysis.
EURUSD underwent a week under heavy sell-off pressure, I have a feeling that investors sold whatever which belongs eurozone, and they might not stop sell eurozone asset unless there is a significant change, but for the being time,I don't think the change coud happen, and between choosing US asset and EZ asset, a kid also answers US asset is better.
I recap key events affecting to EURUSD last week:
- ECB decided to cut main interest rate by 10bp to 0.05% from 0.15% and pre-announced ABS purchase.
- Non-Farm Payroll report of BLS slumped to 142k from 212k, the first time NFP is below 200k for 5 months.
We know that ECB will provide more detail about ABS purchases next meeting of ECB, specificly investors want to know about the size of ABS purchases.From now to that moment, EUR could fall further,but everything is not easy as we think: Forex market is more complicated than we expect, and to understand this market, we need to consider a lot of factors.
Next week, there is no major economic data of both US and EZ, so the main force driving EURUSD absolutely comes from risk appetite and technical analysis. There are two valuable pieces of data are US Retail Sales and EZ Employment Change; however, I don't think those data would have significant impact on EURUSD.
I know surely that ECB is done for this year, they used all necessary weapons to help Eurozone escaping deflation and upcoming crisis. If those weapons couldn't save Eurozone, they have only one weapon on the table: Nuclear weapon with QE like US QE. However, before using nuclear weapon, they need time to evaluate and connsider the reaction of EZ economy to measures of ECB. Hence, economic data will decide the move of EUR, if data is negative, the possibility of QE increases, and EURUSD will fall further; otherwise, if data is positive, it means ECB is on the right way, and the fall of EURUSD could be released.
About USD,, I need to answer one question : Does NFP report last Friday stop the advance of USD ?. We saw USD lossed momentum after NFP was released, but after that, investor began to re-buy USD. US Stock fell after the news, but re-gain the loss quickly and turned back positive. Investors and traders claim that the pullback of NFP was just a correction after 5 consecutive months above 200k; with Consumder Confident, Consumer Sentiment, Durable Good Orders, and ISM PMI beat the Consensus ; this shows that US economy expands sustainably and exactly with FED expect. Hence, I don't think negative NFP could halt the rally of USD.
In Short, SELL EURUSD is a right choice, absolutely BEARISH TREND. The problem is where is the entry point and stop loss as well as take profit. I go to detail in Technical Analysis.
