EUR/USD

It was a very volatile week and we saw euro bulls return.

Next week EUR/USD most probably will experience bigger movements as the uncertainty about the future steps of both the ECB and Fed remains in place.

The euro returned back to the bullish trend, although further gains will be harder to achieve as ECB should „do something” at its March meeting. This should limit the upside potential on the pair.

Monday will see German industrial production for December while Tuesday will bring the current account and trade balance from Germany as well.

On Friday, German CPI and GDP figures are due, followed by GDP figures for the forth quarter from the whole euro zone. Industrial production is expected also and should tick up on a monthly basis.

From the US dollar perspective, the Labor Market Conditions Index is due on Monday and JOLTS Job Openings will be released on Tuesday. However, these numbers are not considered as major and rarely have any impact on the US dollar.

Federal Reserve (Fed) Chair Janet Yellen is due to testify on the Semiannual Monetary Policy Report before the House Financial Services Committee in Washington DC on Wednesday. This testimony will be closely watched as Yellen might present some new view on monetary policy (possibly dovish), which would be US dollar negative. She will conclude her testimony on Thursday.

Friday will bring US retail sales for January, which are projected to improve from previous levels. In addition, the University of Michigan consumer confidence gauge is due and should tick higher to 92.5 from 92.0 previously.

Technically speaking, the pair broke all resistances on Wednesday and is now in a bullish trend. The key support for now stands around $1.1040/50, where previous strong highs are located. The resistance is seen at $1.12 as the pair failed to post clear daily close above it. If it falls, a further rise toward $1.14 in the near term is likely as the momentum is bullish.