The EURUSD pair shot up on positive news for the euro and negative news for the dollar and this helped the pair to move back towards its highs of the range that it had been in over last week. The pair looks extremely bullish at this point of time and what should cheer the traders and the euro bulls is the fact that a large part of this is due to the inherent strength in the euro, unlike in earlier times, when the pair had moved up on the back of dollar weakness alone.
EURUSD Rockets Again on Positive ECB
We had been mentioning that the bullish run was still very much intact in this pair and it really seemed only a matter of time before the euro recovered. That happened yesterday as the ECB minutes was released and that clearly showed that many of the members did discuss about tapering of the QE but decided to hold back till the inflation data supported such a move. This was the clearest indication that the ECB is seriously thinking about the tapering and this was a huge boost to the euro.
If this were not enough to push the EURUSD pair higher, we got the ADP employment report which came in at a less than expected value of 158K when it was expected to be 185K. With the ADP considered as a precursor to the NFP that will be released today, it served as a reminder to the dollar bulls that they were not out of the woods as yet and that they face an uphill battle in the short term. This has continued the trend of weak data from the US over the last few weeks and this brings into question on why the Fed chose to ignore the weak data when they hiked rates last month.
Looking ahead to the rest of the day, the focus will be on the NFP and the wages report and it will be watched with keen interest. Any sign of weakness in this report would just be the tonic needed for the euro bulls to push the EURUSD towards 1.05.
This article was originally posted on FX Empire