The Euro has been the star performer this year, surging an impressive +10.2% against the USD! This strength comes from Europe’s newfound political unity and that massive €500bn German infrastructure plan pumping life into the economy.
The Euro dominates 2024 forex markets, riding high on European unity and Germany’s economic stimulus package.
J.P. Morgan sees EUR/USD hitting 1.19 by September and climbing to 1.22 by next March.
Meanwhile, the US Dollar has stumbled, falling -7.3% so far this year. Weakening policy stance and global tensions have pushed traders away from the greenback. The dollar index has experienced its weakest first-half performance since at least 1980, highlighting the severity of the recent depreciation.
The Pound has managed a decent +5.88% gain, but watch out! Experts predict bearish movement ahead due to UK fiscal problems and a softening labor market. Technical analysis reveals a Head and Shoulders pattern forming on the daily chart, suggesting potential downside if 1.32 breaks.
The Yen has bounced back with a strong +7.7% appreciation, thanks to the Bank of Japan‘s policy shifts. Current data shows USD/JPY hovering above 147, indicating a relatively stable position despite market fluctuations. Technical signals for EUR/USD look bullish right now! The pair recently flipped a bearish pattern and holds strong support levels. A daily close above 1.1806 would signal more upside potential! ⬆
So what about this week? After August’s summer lull, we’re expecting increased movement as traders return to their desks.
Key US economic data drops soon, including:
- Non-Farm Payrolls
- Average Hourly Earnings
- ISM PMI indices
These reports will shake things up! Any signs of US labor market weakness could further weaken the dollar and boost other currencies.
Trading volumes typically surge in September after the holiday slowdown.
For you as a trader, this means watching those high-impact data release days—they often create the best trading opportunities! Keep your eyes on interest rate differences between regions too, as they’ll drive major currency movements in the coming weeks.
