Short term view – EUR/USD
The EUR/USD pair went back and forth during the session on Thursday, essentially settling nothing as we printed a neutral candle. The market still looks a very weak though, and as a result we favour selling at this point. We need to find the right resistant candle after an attempt at a rally, and then we will join the fray. Ultimately, we think this pair could go to the 1.33 handle. As for the upside, if we get above the 1.3550 level, we suspect that the market would then be heading back to the 1.37 handle.
After reaching an 8-month low at 1.3437, the EUR/USD rebounded to put itself in a position to post a potentially bullish closing price reversal bottom. The move was triggered by better than expected Euro Zone Flash Manufacturing PMI data.
After rebounding from the low at 1.3437, the market surged to the upside after taking out a down trending resistance angle at 1.3450. Upside momentum drove the market through the previous low for the year at 1.3476, but the rally stalled at 1.3484.
A close over 1.3463 will put the market higher for the session and form a closing price reversal bottom. Based on the range for the week at 1.3548 to 1.3437, the first target is the pivot at 1.3493. This is followed by the June low at 1.3502.
If the momentum shifts dramatically to the upside then look for an eventual move into a down trending angle from the 1.3700 top at 1.3530 today.
The EUR/USD is trading higher at the mid-session. The Forex pair turned the main trend to up on the hourly chart after taking out the last swing top at 1.3473.
If a secondary higher bottom forms inside 1.3437 to 1.3484 then look for a strong close. After taking out 1.3483 to 1.3494, the next level will be 1.3495. Overcoming this price will reaffirm the uptrend. Closing over 1.3463 will put the market higher for the day and form a closing price reversal bottom on the daily chart.
|11:30am||EUR||German PPI m/m||0.00%||0.10%||-0.20%|
|3:30pm||EUR||German Buba Monthly Report|
|8:00pm||USD||Crude Oil Inventories||-4.0M||-2.1M||-7.5M|
|12:30pm||EUR||French Flash Manufacturing PMI||47.6||48.5||48.2|
|EUR||French Flash Services PMI||50.4||48.9||48.2|
|EUR||Spanish Unemployment Rate||24.50%||25.90%||25.90%|
|1:00pm||EUR||German Flash Manufacturing PMI||52.9||52.2||52|
|EUR||German Flash Services PMI||56.6||54.7||54.6|
|1:30pm||EUR||Flash Manufacturing PMI||51.9||52||51.8|
|EUR||Flash Services PMI||54.4||52.7||52.8|
|EUR||Italian Retail Sales m/m||-0.70%||0.40%||0.30%|
|11:30am||EUR||GfK German Consumer Climate||9||8.9||8.9|
|1:30pm||EUR||German Ifo Business Climate||108||109.6||109.7|
|EUR||M3 Money Supply y/y||1.50%||1.10%||1.00%|
|EUR||Private Loans y/y||-1.70%||-1.80%||-2.00%|
|6:30pm||EUR||Belgian NBB Business Climate||-6.5||-6.2|