Forex Analysis: EUR vs. USD

Usually when the US dollar weakens, the Euro rises in relation. On the other hand, when the US dollar rises Euro’s value declines in relation.

For example, when the US economy faces increasing higher unemployment rate, this results in weakening of the the US dollar. Therefore a trader will buy (ask) the Euro with the anticipation that it will appreciate vs. the dollar. Similarly, if there is a surge in demand for US financial instruments like treasury bonds or equities, this will help push the value of the US dollar up in relation to the Euro. In this case, the forex traders sell (Bid) the Euro since the value of US dollar will appreciate.

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