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EUR/USD prefers the glass half empty, slips in range

EUR/USD made a move to 1.0905 only  to drop rapidly to the 1.06 handle. The world’s most popular currency pair struggles to find a new direction.  A euro-related event has been positive but also a dollar-related event has been positive.

In the struggle between these two forces, the pair leans a bit lower. Nevertheless, the battle for the next big move is still wide open.

More:  US ISM Non-Manufacturing slips with 55.2 – USD rally stalls

ECB edges closer to the exits

Two ECB members spoke out today. The more senior one, the Bundesbank’s Jens Weidmann, did not surprise with hawkish comments. The head of the German central bank said it is time to ease the bond buys. The Frankfurt-based institution has just reduced its bond buys from 80 to 60 billion euros.

It is not surprising to hear such words from the German orthodoxy. Weidmann would want to end the QE program altogether by the end of this year, but seems to understand he may be in a minority.

Another ECB member went a bit further.  Vasiliauskas said that he wants the ECB to talk about further reducing bond buys this summer. The  Governing Council  has its next big meeting in June, accompanied with forecasts. Does he want a move to come then?

On the other hand, the  Lithuanian central banker said that he wants an orderly exit from QE  before raising rates. This is not that hawkish, but his determination to end easing certainly ease.

But ADP beats bigtime

The US related event is the release of the private payrolls by ADP. According to the survey, 263K jobs were gained in March, far better than 187K that had been expected. This implies a blockbuster NFP on Friday. The correlation between the private survey and the official BLS one has improved of late.

The previous report for February has been revised to the downside, from 298K to 245K. Nevertheless, markets focus on the present and the future and tend to ignore the past, even if this is the near past.

This leaves EUR/USD leaning a bit lower, trading around 1.0660, a pivotal line in the range. Further support awaits at 1.0630, followed by 1.0520. Resistance is at 1.0720. The pair reached 1.0690 in a previous swing to the upside.

More:  EUR/USD on the up and up to 1.15? Two opinions

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.