EUR Trading Outlook (27-02-2015)

EUR/USD A lackluster session in Europe’s morning met some stunning action in NY. The pair sat near 1.1355 into NY’s open after touching a 1.1380 high in Europe. The USD rallied early on as the Fed’s Bullard noted on CNBC the FOMC should remove ‘patient’ from its March policy statement and clear the way for a rate hike. The USD got a further boost off the solid durable goods result as US bond yields soared. EUR/USD dived down and hardly looked back until it reached its 1.1184 low. Overly zealous USD bears covering recent shorts combined with steady selling from medium and short term names to drive EUR/USD lower. A slight slip late in the day for the USD saw EUR/USD lift towards 1.1200 ahead of NY’s close. Traders now look to German Feb CPI readings and US Q4 GDP report for their cues. Should US GDP come in above forecasts EUR/USD is likely to get hit again as the market will believe the chances of a Fed hike are upped. The 2015 EUR/USD low then comes into play.