Back
8 May 2015
EUR/USD… too far, too fast?
FXStreet (Edinburgh) - The European currency is struggling to close its fourth consecutive week with gains vs. the US dollar on Friday, after the rejection from the 1.1400 handle sent EUR/USD more than two big-figures down to test the 1.1170 area in the wake of Payrolls numbers.
One source of EUR-strength, the sell off in the European debt markets, seems to have come to an end – or is giving signs of exhaustion - following a rebound in prices that pushed yields back to levels deemed more ‘normal’ along with the volatility slowing down its recent unusual pace.
The other driver responsible for the recent steep upside in the pair has been the data-induced weakness around the greenback. However, the dollar, tracked by the US Dollar Index (DXY), seems to have found strong support in the 94.00/93.90 band with buyers stepping in following the positive results from Thursday’s Initial Claims (265K) and today’s Non-farm Payrolls in the US economy (223K). Speculations have started to roll again regarding the likelihood of the Fed starting its hiking cycle in September, which should re-ignite a more convincing buying interest around the USD and the consequent downside pressure in EUR.
One source of EUR-strength, the sell off in the European debt markets, seems to have come to an end – or is giving signs of exhaustion - following a rebound in prices that pushed yields back to levels deemed more ‘normal’ along with the volatility slowing down its recent unusual pace.
The other driver responsible for the recent steep upside in the pair has been the data-induced weakness around the greenback. However, the dollar, tracked by the US Dollar Index (DXY), seems to have found strong support in the 94.00/93.90 band with buyers stepping in following the positive results from Thursday’s Initial Claims (265K) and today’s Non-farm Payrolls in the US economy (223K). Speculations have started to roll again regarding the likelihood of the Fed starting its hiking cycle in September, which should re-ignite a more convincing buying interest around the USD and the consequent downside pressure in EUR.