Forex Today: Euro Plunges, US Dollar Higher

Adam Lemon

The Forex market is dominated by a falling euro and rising US dollar.

  • The EUR/USD continued its bearish breakdown to long-term lows yesterday, trading as low as $1.1263 after spiking down during the Asian session, a 16-month low price. This move is driven by enhanced euro weakness after Cristine Lagarde the ECB President ruled out an ECB rate hike in 2022. It is likely that the price will fall further over the coming days, presenting an opportunity for trend traders.

  • The US Dollar Index has become established above key long-term resistance, breaking out to reach a new 15-month high in a significant technical move confirming the long-term bullish USD trend.
  • The Turkish Lira is continuing its long-term decline and falling to record low prices, continuing to advance strongly after crossing 10 Lira to the US dollar for the first time at the start of this week. We are likely to see a further advance in USD/TRY over the coming days, but be aware that trading this currency pair can be expensive and volatile.
  • In the Forex market, the US dollar is the strongest major currency while the euro is the weakest. The market is currently moving in line with long-term trends.
  • US retail sales data came in higher than expected yesterday, showing a monthly increase of 1.7% against an expected increase of 1%. This suggests the US economy is hot and is seen as marginally increasing the case for an earlier rate hike by the Federal Reserve.
  • The cryptocurrency sector dipped again yesterday. Bitcoin is trading below the key round number at $60k.
  • Last week saw the third consecutive global weekly rise in new confirmed coronavirus cases after two months in which cases fell steadily.
  • It is estimated that 52.2% of the world’s population has received at least one dose of a coronavirus vaccination.
  • Total confirmed new coronavirus cases worldwide stand at over 255.1 million with an average case fatality rate of 2.01%.
  • The rate of new coronavirus infections appears to now be increasing most quickly in Australia, Bolivia, Chile, Croatia, Cyprus, the Czech Republic, Denmark, the Dominican Republic, Germany, Greece, Hungary, Iceland, Italy, South Korea, Laos, Netherlands, New Zealand, Norway, Poland, Slovakia, Slovenia, Switzerland, Trinidad, and Vietnam.
Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

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