Minimum spread- 0.2
Typical spread- 1.8
Minimum nominal trade size- 1000
Overnight interest (annual) sell- -0.60%
Overnight interest (annual) buy- -0.1.70%
Trading hours (GMT) – 24*5
EUR/USD is the ticker that represents the strength of the euro against the U.S dollar. Euro dollar pair represents the world’s two largest economies. The US dollar measures the strength of the economies of the European Union, while the euro also fully acts as a kind of indicator of the US economy. Due to its popularity, it offers great opportunities such as high liquidity, consistently low spreads over other forex pairs.
Euro is a young currency, established in 1999, created on the basis of the European Currency Unit, which replaced a whole galaxy of national currencies of the EU countries. Therefore one of the features of the euro is its susceptibility not only to macro-economic statistics of the entire EU zone but and to individual economies of France, Germany, formerly Great Britain.
The euro was created to facilitate the international trade of European trading partners. Since its creation in 1999, this currency pair has undergone significant volatility, which was caused by several world-wide events, such as the technological boom that has turned into a technological breakthrough, the real estate price bubble, and the European debt crisis.
Understanding the EUR/USD price
The rule to read the price quote is similar to any other pair. In EUR/USD, the euro represents the base currency in relation to the U.S dollar. Thus when the EUR/USD rally, that means the euro is gaining strength over the U.S dollar, and euro loses its strength when EUR/USD falls. The price quote of EUR/USD means the amount of dollar, which is equivalent to one euro. For example, when EUR/USD quotes 1.40 prices, it means one euro is equivalent to 1.40 U.S dollar.
Key Factors to keep in mind while trading EUR/USD
Monetary Policy Impact
The role of the Issuer and the Pan-European Currency Regulator is played by the European Central Bank (ECB). The headquarters of the bank is located in Frankfurt, and the body itself is formed on the basis of the participation of all representatives from all countries of the European Union. In addition to issuing activities, supervision, and regulation, the ECB Statutes spell out obligations to maintain the financial stability of the Eurozone.
The monetary policy of this body affects almost all currencies of the Forex market. The meetings of the European Central Bank are monitored by the traders as dates and times are known in advance. The announcement of the rate, if it is unchanged, may not impress traders, causing a slightly volatile surge, but some unexpected announcements can cause a significant move in the market.
The Federal Reserve is also an important body which often followed by traders to anticipate the price movement. The Fed is an independent supervisory federal agency that includes 12 reserve banks in different states, which in turn have thousands of commercial banks. The Fed revises the Federal funds rate eight times a year.
Any political unrest can cause a significant effect on the eur/usd pair. For example, news related to the Brexit deal, the election in a nation, which constitutes a bigger economy in the European Union.
The economic calendar offers a significant amount of information. Some of the most important data are:
- CPI-consumer Price Index
- GDP– gross domestic product
- PMI– purchasing managers index
- Trade balance
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