EUR/USD: 1.0738
The Euro spent a relatively quiet Friday session confined to a range of 1.0727/82, capped on the topside after a poll indicated that Marine Le Pen is making gains in the French election, while supported on the downside by the soft tone to the dollar.
The short term momentum indicators suggest that we may be in for a similar session on Monday, with the 4 hour charts being overbought and turning to point lower, while the dailies are beginning to look a little more constructive. The contradictory look of the indicators suggest that EurUsd will remain choppy and rangebound on Monday and possibly Tuesday. If wrong, and the Euro can make further headway, then above Friday’s high would find sellers at the descending trend resistance, now at around 1.0790 and which should be strong at the first attempt. Beyond there though, could then head towards 1.0830, a break of which we could then see a run towards 1.0873 (8 August high) and on to the 200 DMA (1.0900). On the downside, support will be seen at the minor Fibo levels from the move up from the recent 1.0490 low, beginning at 1.0715 and then at 1.0670. As before, given the increasingly positive look of the daily charts, it would appear that buying dips is the current plan although I remain wary of buying the Euro towards the top end of the recent range, and if Le Pen makes further advances in the French polls the Euro will find it has limited topside potential.
| 24 Hour: Prefer to buy dips | Medium Term: Neutral | ||
| Resistance | Support | ||
| 1.0900 | 200 DMA | 1.0727 | Friday low |
| 1.0873 | 5 Aug high | 1.0714 | (23.6% of 1.0494/1.0782) |
| 1.0829 | 2 Feb | 1.0670 | (38.2% of 1.0494/1.0782) |
| 1.0790 | Descending trend resistance | 1.0635 | (50% of 1.0494/1.0782) |
| 1.0782 | Friday high | 1.0605 | (61.8% of 1.0494/1.0782) |
Economic data highlights will include:
M: German PPI, BuBa Monthly Report, US Chicago Fed National Activity Index, Fed’s Evans Speech
T: US Current Account, Fed’s George Speech, API Weekly Crude Oil Stock Inventory
W: ECB Non-MP Meeting, Current Account, US House Price Index, Existing Home Sales, EIA Crude Oil Stocks Weekly Change
T: German Consumer Confidence, EU Economic Bulletin, Targeted LTRO, Janet Yellen Speech, US Jobless Claims, Kansas Fed Mfg Activity, New Home Sales, Fed’s Kashkari Speech EU Provisional Consumer Confidence
F: EU/US Flash Mfg/Composite/Services PMIs, US Durable Goods Orders, Fed’s Evans/Bullard Speeches
Interested in EURUSD technicals? Check out the key levels
All content on this website, www.fxcharts.com.au (FX Charts PL) is a personal view only and offers absolutely no guarantee as to the correctness or otherwise of that opinion. The content here is of a “general nature” only and does not constitute personal or investment advice. The FX Charts website is not an inducement to trade Foreign Exchange (FX). No liability whatsoever is accepted for any loss or damage that may result, directly or indirectly, from any , comment, opinion, information or omission, whether negligent or otherwise, within the FX Charts Website. The information and any opinion or outlook expressed in this commentary may be based on assumptions or market conditions and may be liable change at any time, without notice.
Recommended Content
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.