Home » Euro vs Dollar Daily Chart » Euro vs Dollar – bullish trend strengthens further

Euro vs Dollar – bullish trend strengthens further

euro vs dollar daily forex chart

EUR/USD - daily chart 6th October 2010

The euro vs dollar continues to surge higher, with yesterday’s wide spread up candle adding a further degree of momentum to the recent strong trend, driving the currency pair through the 1.3800 level and on towards 1.4000 in due course. The technical picture is extremely strong at present, with the recent trend finding excellent support from the 9 day moving average in particular, with the 14 day moving average adding an extra layer of support below on the daily chart. To complete the bullish picture we now need to see the 40 day moving average cross above the 200 day, which will further reinforce the medium term outlook for the pair.

The fundamental backdrop is also helping to drive the euro higher, as continuing weakness in the US dollar, exacerbated by the FED policy of further quantitative easing weakens an already fragile currency further, with the euro vs dollar benefiting as a result. In addition, the ECB’s intention to take a harder tone with regard to any potential quantitative easing is also helping to propel the euro higher, and until this strength becomes an issue for European exporters, then we are likely to see this continue for some time to come, reinforced by further US dollar weakness. Tomorrow of course sees the release of the ECB interest rate decision and subsequent statement, and with the markets already having factored in a rate hold, all attention will be on the tone of wording in the statement referring to monetary policy in the short and medium term. As such we can expect further strength from the euro and a break above 1.4000 in due course