Will the Euro/Dollar Pair, Currently in a Stalemate, Find a Clear Direction?

Will the Euro/Dollar Pair, Currently in a Stalemate, Find a Clear Direction?

13.12.2021

Last weekend, the three major U.S. stock indices all rebounded, leading to a market environment characterized by rising stock prices, falling interest rates, and higher crude oil prices. Amid strong economic indicators released over the weekend, the yield on the 10-year U.S. Treasury note declined, creating a market environment conducive to buying. WTI crude oil rose to $72.60, while the VIX (fear index) fell by about 13% to 18.6.

The foreign exchange market opened without any significant gaps, and the stalemate between the U.S. dollar and the euro continues. The EUR/USD pair is trading around 1.129 as it searches for direction, having yet to break out of the range it has been trading in since the end of last month. On the daily chart, we will be watching closely to see if the pair breaks through either the recent low of 1.118 or the recent high of 1.135.

Today, aside from the release of the Bank of England’s Financial Stability Report at 4:00 PM, Turkey’s current account balance, and Turkey’s industrial production figures, as well as Hong Kong’s Producer Price Index and Industrial Production Index at 5:30 PM, no major speeches by key figures or economic indicators are scheduled.This week, the UK Consumer Price Index and the US FOMC interest rate decision and statement are scheduled for Wednesday the 15th, followed by the Swiss National Bank (SNB) interest rate decision and the UK Bank of England (BOE) interest rate decision on Thursday the 16th. The market is likely to adopt a wait-and-see stance, particularly leading up to the US FOMC meeting on Wednesday the 15th. Today, ahead of the FOMC meeting, we want to closely monitor how the balance between European currencies and the US dollar evolves.