EURUSD Fundamental Analysis Ahead of US China Trade Optimism


 Here is the EURUSD Fundamental Analysis of 31 December, 2019. EURUSD is on track to the end of 2019 with a 2% loss. Trade optimism allowed the EURUSD to regain its balance in the fourth quarter. A monthly close above the November high would confirm a bullish break. Meanwhile, do not forget to check the 2020 New Year Forex trading hours and global schedules so that you can schedule ahead.

31 December, 2019 | AtoZ Markets – EURUSD appears to be heading towards the end of 2019 on a negative note. The pair is currently trading near 1.12, which is 2.11% down from where it was trading on 1 January. The single currency fell by 4.66% in 2018. The 2019 loss would have been greater if the pair had remained near the low levels below 1.09 recorded on 1 October.

EURUSD Fundamental Analysis – 31 December 2019

The currency is on track to end the fourth quarter with a gain of 2.81%. The continued easing of trade tensions between the US and China probably helped the euro to regain its balance, after falling 4.14% in the third quarter.

Besides, the signs of a timid are bottoming out of the German economy. And the call by the President of the European Central Bank, Christine Lagarde, more fiscal support possibly added to bullish pressures. As discussed in Asia, the pair is expected to close Tuesday above the November high of 1.1175. This would confirm a bullish break on the monthly chart.

A bullish close seems likely, thanks to the optimism of traders. A Chinese outlet on Monday reported that the United States and China could sign the phase-one trade deal as early as this week.

Read More: 2020 New Year Forex trading hours and schedule

US China Phase One Trade Deal

The dollar index (DXY) measures the currency against a basket of rivals. It remained stable at 96.728 at the start of the Asian trade. On Friday, the index had suffered its largest drop in a day since March, leaving its gains for the year at less than 0.6%. It compared to gains of 4.4% in 2018. However, it is now on track for the smallest increase since 2013.

Encouraging news about the Sino-US trade deal has boosted the sense of risk in the currency markets overnight. White House trade adviser Peter Navarro told on Monday that US-China Phase one trade deal would likely be signed next week. But confirmation would come from President Donald Trump or the US Trade representative.

Increased optimism about US-China trade relations and improved global growth prospects have pushed investors out of other safe-haven assets like Treasury bonds. Investors’ appetite for risk also helped push the euro to a 4.5 month high at $ 1.121 on Monday. It was last up 0.1% to $ 1.1209. Signs that the eurozone economy could stabilize have raised the single currency in recent weeks.

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