Trading the Euro
After the US dollar, the euro currency (EUR) is the most widely traded foreign currency, and the EUR/USD currency pair is arguably the forex trade that sees the most activity on any given day. The euro is the latest and the most ambitious attempt at a currency union so far, and is used by 13 countries inside the European Union, with Estonia being the latest addition on 1 January 2011. It is also used outside the EU, for example as the currency of Montenegro.
The euro was introduced onto global foreign exchange markets in 1999, three years before it became available in coins and notes. Although it suffered initially due to a lack of confidence on the part of traders and a severe downturn in the French and German economies in 2001-03, the euro rallied in the years since.
The so-called Eurozone represents one of the largest and most prosperous economic blocs in the world. Interest rates for the Euro are set by the European Central Bank in Frankfurt, and are closely watched by traders. But because the Eurozone is so economically diverse, it remains hard for currency traders to decide what the right price should be for the euro: economic figures released by the German government are still considered valuable, but they do not speak for the Eurozone as a whole.
There continues to remain a great deal of speculation in the financial media about whether the euro would be able to survive European sovereign debt crises, or the Eurozone break up into smaller currency blocs. While some European governments continue to struggle financially, it has been a popular currency to short against other, stronger currencies like the Canadian Dollar or the Swiss Franc. However, the EUR/USD pair remains one of the most popular currency pairs to trade and a good potential starting point for new currency traders.
Latest Euro News
Is the US Treasury yields correction an attractive entry point for the Euro?
The gap between the 10-year Treasury and its German bund counterpart is 2.11%, which is close to the highest levels since last April.
Can Fed caution slow the dollar’s bull run?
The dollar has been gaining steadily against other major currencies for the last three months, but will the Fed slow it down?
French election galvanizes short euro FX trade
With no outright majority in the French parliament after Sunday's elections, forex traders are selling down the euro.
Politics will be key for financial markets this summer
European markets have rallied on the back of the French first round vote, but plenty more uncertainty ahead for traders in Europe and USA.
Playing the ranges: ECB rate cut likely
Key event risk in the week ahead includes the ECB meeting, US nonfarm payrolls and the unemployment rate, plus Swiss CPI inflation
Low volatility still offers abundant opportunity
Markets start the week on a slow note with the US and UK sessions limited by Memorial Day and the UK public holiday on Monday.
Why are FX markets suffering with low volatility right now?
The FX market has been subdued, to say the least. We explore why that may be, and what might spur a resurgence in volatility
Euro Zone CPI expected to continue dropping; economists warn about cutting too soon
The first reading of the November Euro Zone CPI is released this week with expectations of a drop in Headline and Core numbers
Technical Analysis: Will 2024 be a year of central bank easing?
Central bank easing is a theme that will be front of mind for 2024, with some debate as to why the markets are discounting such easing
Are the Crude Oil and Natural Gas markets set to direct sentiment?
Will economic data and US earnings move the dial or will newsflow from the Middle East consume attention and direct sentiment?
Are we entering the end game for central banks’ inflation battle?
Pierre-Antoine Dusoulier, founder & CEO at iBanFirst, assesses whether central banks are nearing the peak of their tightening policies.
Has the euro run out of steam against the dollar?
The euro remains strong against the dollar despite trading a few notches lower this week. and is up 1.67% on the month in June.
What’s behind the Federal Reserve’s decision to pause rates?
While the Fed stepped away from raising rates this month, the ECB pushed higher, creating new dynamics in the GBP/EUR trade.
Dollar rebound could be followed by price corrections
The rebound in USD could be followed by some price corrections thanks to hopes that a deal over the debt ceiling issue could be reached.
The pound is rallying on the back of latest UK GDP data
The pound moved higher after the UK’s GDP data came in slightly above expectations but the currency still remains fragile.
Technical Analysis: European data in focus this week
The markets are focused more intently on Europe this week with flash CPI prints and a rate decision by the European Central Bank
ECB December meeting: the three key takeaways for forex traders
Last week's ECB meeting is being called out as the most important since the Draghi era of policy: what does that mean for EUR traders?
Traders favouring EUR vs GBP after packed week of central bank action
Sterling was seen to be on the back foot at the end of last week after interest rate hikes across the board from central banks last week.
Technical analysis: a positive bias to risky assets
With such lively news flow and so many conflicting cross-currents, we look at how traders could act into the new week
Dollar strength versus Sterling and Euro weakness
Trader educator Chris Tubby takes a look at what has been happening in the forex and energy markets recently.
