EUR/USD Daily Fundamental Forecast – February 13, 2017

EURUSD has been under pressure since Friday and today morning as well as the dollar has been gaining in strength across the board. The dollar strength is expected to continue for the rest of the week and so it would be interesting to see how the pair would cope up with the pressure. So far, the region around 1.060 has been holding on and repeated attempts by the bears to break down this region has been futile. But at the same time, the dollar strength has not been razing down other currencies but it has been a slow and steady build up of strength which means that if this continues, it would only be a matter of time before the support is broken through.

The main reason for the strength in the dollar has been the fact that Trump had announced that he would be handing out some major tax cuts for corporates and citizens alike and this has cheered the markets and brought back the Trump trade. The markets had been a bit jittery over the last few weeks due to the major policy changes by Trump and the open threats to some of the major countries across the world and this had kept the dollar under pressure. But now is the time for goodies and we do not know how long it is likely to last before Trump gets back to his old grumpy ways and so the dollar bulls are trying to make maximum use of this period. We also have the Fed and its idea of hiking rates thrice this year and the market is also building up dollar longs in anticipation of the Yellen speech on the economy tomorrow where it hopes that she would continue to be bullish on the economy and the rate hikes as well.

Looking ahead to today, we do not have any major economic news from the US or the Eurozone and so we can safely expect the dollar strength to continue and for the EURUSD pair to be under pressure for the rest of the day.