January 17, 2019 09:27 AM
EUR / USD is one of the most popular and popular pairs in the world due to its commercial impact is considered within the "major currency pair". Due to its importance in the financial markets, this pair is always analyzed to predict its possible moves.
The year 2018 was dominated by two events that changed the financial world, one of which is political activity, and the other, the fear of the United States' economic downturn. It can be said that the first event was almost a fact and was presented with the victory of Brexit and Trump. As far as the second event is concerned, this started in the second half of the year, where experts say business activity has not reached record growth for a long time, however, the growth rate was one of the most four years
Trump and two battle fronts
In the last year, we have witnessed the trade tensions between the United States and the rest of the world, they have been considered as one of the main political fears.
America's protection policy, "Make America Great Again," focused mainly on the trade deficit with China, which boosted these fears throughout the year. The US trade deficit with China was about $ 347 billion in 2017, and despite the sanctions, tariffs and policies implemented by Donald Trump, the deficit was equal in the first 10 months of 2018.
When analyzing US macroeconomic figures, analysts have found that they are encouraging enough; However, taking into account the fact that there were some alarming figures behind the titles, this would mean that the US continues to think about continuing the struggle to reach its commercial goal. According to specialists, when China announced it would resume soya purchase in the United States, it was taken as a show of goodwill by the Asian giant. Even so, in 2018 soybean exports to China fell by 98%. In 2017, total exports fell by 1.0% in the 10 months after an increase of 12.8% in the same year.
In January, China imported 1.2 billion soybeans from the United States. The USDA (US Department of Agriculture) says that the area cultivated with soybeans will decrease by 6.6 million acres in 2019. It is very important to point out that China remains in the battle, relying on various trading partners and that it has implemented the reduction costs for companies as well as consumers, in order to cushion the impact of US tariffs on tax reforms.
US President Donald Trump opened another battle in the second half of 2018. He decided to intervene in what he did not do another US president, he referred to the Federal Reserve's monetary policy, commenting that he was not "happy" with politics adjusting on the intention to raise interest rates, direct intervention in central bank activity and exerting pressure on Powell.
The EUR / USD technical perspective
The prediction of the annual movement of a currency pair is not easy and becomes even more difficult when it comes to a pair dominating high frequency operations such as EUR / USD. However, there are some general macro events that can give you an idea of how this pair of coins will be presented in 2019.
Analysts say there are two main issues that financial markets will focus on this new year that has begun. One of the closest catalysts will be to see what the US Federal Reserve is doing during the year. On the other hand, the 90-day arrest warrant with China will end in March this year. Therefore, it all indicates that the US dollar can fall all year round.
The other major catalyst is the European Union. The discomfort that is seen in that part of the world, especially due to debt issues and, of course, Brexite, who has the deadline too. Experts say that for this reason the euro could be considered a safe haven in regional economies. The ECB argued that no rate increases would be observed by mid-2019.
Undoubtedly, the EUR / USD is one of the most attractive traders on the forex market and, to some extent, the analysis and operation of Eurodollar can be relatively simple, as it is easier to obtain information about its evolution. As already mentioned in 2019, the euro will present market movements that can represent opportunities in the world of transactions.