Technical Analysis EUR USD
EUR USD for InvestorThe EUR USD currency pair is included in the major group of currencies, and the trading of this currency pair accounts for about a third of the total trading volume on the Forex currency market. The demand for the currency is due to the fact that both of its constituent currencies, the Dollar and the Euro, underlie the world's largest economies, the United States and the European Union, and the USD, moreover, is the world's main reserve currency.
The quote of the pair is reversed, as evidenced by the US dollar standing second.
The liquidity of the EUR USD currency pair is at a high level almost always, however, the greatest activity usually falls on the European and American trading sessions.
It should be taken into account that the EUR USD quote has the largest trading turnover in the world among currency pairs, which is why you can not be afraid of a lack of liquidity even during periods of decline in activity. At the same time, the volatility of the asset remains at a relatively moderate level.
EUR USD has a significant dependence on large-scale economic news. One of the main factors for its forecasting can be considered the US monetary policy, including the dynamics of interest rates and open market operations.
A good indicator for the EUR against USD is the change in the difference between the interest rate of the US Federal Reserve and the interest rate of the European Central Bank.
EUR USD is great for currency traders who are just starting out as the currency moves at a fairly slow pace compared to other major pairs. In addition, EUR USD is negatively correlated with USD/CHF and this is due to the positive agility with GBP/USD. Traders who are actively working with the euro-dollar currency pair should always be aware of economic developments in the US and the Eurozone. The pair mainly adheres to the trading movement along the trend. When opening market transactions, a trader must evaluate current prices, determine the trend and find historical levels to identify a trading perspective.
There are several good reasons to trade EUR USD. First of all, it is one of the most popular and widely traded pairs around the world in all markets, which helps the pair provide the liquidity needed to move prices. EUR USD is actually the most traded currency pair, because the Euro and the US dollar are both among the most liquid currencies, as there are many transactions with these currencies. This indicates that a Forex trader can invest a significant amount of money in a position/trade. They can lead to large profits with a small scale of market fluctuation.
The EUR USD currency pair has a narrow spread, which in most situations receives a higher spread quote from forex brokers due to the fact that this is one of the more impulsive and volatile pairs. Thus, the biggest advantage of trading this EURUSD pair is that the trader will be able to make large trades and will pay smaller spreads.
Traders need to understand and consider important points before trading EUR USD. It is paramount that countries such as Germany, France, Italy and Spain form more than 3/4 of the Eurozone's GDP. Thus, economic news and statistics related to these countries, along with the US, have a huge impact on trading results and volatility. One simple rule about the EUR USD currency pair - the more volatility in the market, the more profit you can make. Any news, whether good or bad, can create a market move that is good for some and not so good for others. It is at this point that an opportunity is formed for the trader; this is his best time to trade currencies, provided that he saw it and calculated it.
EUR - Euro (€). It is the second largest currency in circulation after the US dollar. Since the Euro was introduced, it has received recognition and approval to become the official currency for the 16 countries that have been included in the Eurozone since 2002 and have replaced their national currencies (Austria, Cyprus, Belgium, Finland, France, Germany, Greece, Luxembourg, Malta, Netherlands, Italy, Ireland, Portugal, Slovakia, Slovenia and Spain). The euro is the second largest reserve currency after the US dollar, and the eurozone is the second largest economic region, once again ranked second in the economy behind the US.
Non-Euro European countries such as Denmark, Sweden and the United Kingdom are controlled and served by the European System of Central Banks, which includes the European Central Bank and the Eurozone central banks.
USD - US Dollar ($). The currency of the American economy, and over time it has become the most reliable currency in the world. Despite efforts to drop and crowd out the dollar, the recent economic crisis has clearly demonstrated the support that the US dollar enjoys and that it is an essential option for investors looking for a safe currency.
The economy is a complex topic, and the American economy is no less. To understand the dollar, you need to understand everything in detail - the reason for the rise and fall of interest rates along with the political pressure created by their structured labor groups.