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Forex pairs in this Article » EUR/USD
By: DailyForex.com

The EUR/USD pair got a little bit of a bump higher during the session on Wednesday, as the 1.35 level continues to be somewhat supportive. In fact, this is an area that I have been watching very closely over the last several weeks, as it has been fairly predictable. I believe that the market will more than likely go higher from here, but I do think that it's possible that it may stall a little bit, simply because of the impending nonfarm payroll numbers that of course will be a major factor in where this market goes. This is less about the Euro at this point, and more about the US dollar and how weak it may get.

While the Europeans have exited recession, this will drive up the value the Euro naturally, as money comes into the European Union to buying stocks if nothing else. If you look at the indices around the continent, there are plenty of signs of economic improvement, with the peripheral European indices being particularly positive.

Friday should give us more answers.

I believe the Friday should give us more answers, but quite frankly I still expect to see this market go back to the 1.40 level. After all, there is really nothing to make us think that the US dollar should appreciate over the longer term, especially considering how loose the Federal Reserve's monetary policy has been. Quite frankly, I don't see any chance of the changing anytime soon and expected to be at least 2014 before anything is done.

It would not surprise me at all if it was the summertime before the Federal Reserve could taper off of quantitative easing, because let's be honest here: Ben Bernanke loves quantitative easing. On top of that, Janet Yellen is a known dove, and certainly will keep the loose monetary policy going as long as possible. With that being the case, I don't see the US dollar having much of a chance over the longer term. The real question becomes whether or not we can get above 1.40, which might be a bit of a stretch. Nonetheless, there's a lease 500 pips to be had to the upside as far as I can see.

EURUSD Daily 11713


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