EUR/USD latest news
EUR/USD latest analysis
1. Technical Overview
As for the EUR/USD pair, it trades near the mentioned daily low, at levels last seen in July 2017. The 4 hours chart shows that Monday's advance was enough for technical indicators to correct extreme oversold conditions, bringing back sellers. In the mentioned chart, a strongly bearish 20 SMA keeps capping the upside, now around 1.1420, while technical indicators resumed their declines, the RSI now piercing the 30 level, but the Momentum still hesitating within negative levels. A short-term upward corrective movement could come on a recovery above 1.1365, Monday's low and now the immediate resistance, but selling interest will likely reappear on approaches to the 1.1400/20 region.
Support levels: 1.1330 1.1300 1.1260
Resistance levels: 1.1360 1.1390 1.1420
EUR/USD PRICE SENTIMENT
EUR/USD BULLISH PERCENTAGE INDEX
The Euro has extended its run of 2018 declines, breaking down below critical support at 1.1500. The bearish break ends a period of multi-week consolidation and opens the door for a bearish continuation towards a measured move extension target around 1.1200.
EUR/USD Pivot points
EUR/USD trading positions
2. Fundamental Overview
Data coming from Europe came in mixed, in-line with market's expectations and previous' month readings, but fell short of incentivizing EUR demand. Stocks recovered from Monday's slump, as Turkey-related risk aversion ebbed, but the only difference across the FX board being decreasing demand for the JPY. The dollar is on demand despite the latest gains could be a bit too much, and the risk of a downward corrective movement is now higher. The EUR/USD pierced its previous low and fell to 1.1330, on pure dollar's strength.
Germany and the EU published preliminary Q2 GDP figures, up 0.5% and 0.4% respectively, both slightly above the market's forecast. The ZEW confidence survey indicated that business sentiment improved in August, although the readings held well below average and within negative readings. For Germany, Economic Sentiment resulted at -13.7, improving from the previous -23.7, while for the whole EU, it printed -11.1 vs. the previous -18.7. The US released Export and Import prices for July, both down monthly basis but sharply up when compared to a year earlier. Nevertheless, the market remained indifferent to the figures. Several European markets will be closed this Wednesday with no relevant data to be out from the Union, although the US will release July Retail Sales and some minor employment data. Sales are seen up 0.1% MoM, while the core reading is seen up by 0.3%.
EURUSD FUNDAMENTALS TODAY
3. Big Picture
Themes affecting the EUR/USD
Influential Institutions & People for the EUR/USD
The Euro US Dollar can be seriously affected by news or the decisions taken by two main central banks:
The European Central Bank (ECB) is the central bank empowered to manage monetary policy for the Eurozone and maintain price stability, so that the euro’s purchasing power is not eroded by inflation. The ECB aims to ensure that the year-on-year increase in consumer prices is less than, but close to 2% over the medium term. Another of its tasks is the one of controlling the money supply. The European Central Bank’s work is organized via the following decision-making bodies: the Executive Board, the Governing Council and the General Council. Mario Draghi, member of the Executive Board, is also the President of this organism.
On the other
Mario Draghi is member of ECB's Executive Board and also the President of this organism. His declarations are an important source of volatility, especially for the Euro and the currencies traded against it. Born in 1947 in Rome, Italy, he graduated of the Massachusetts Institute of Technology and became President of the European Central Bank in 2011. Draghi gives press conferences in the back of how the ECB observes the current European economy. His comments may determine positive or negative trends for the Euro in the short-term. Usually, a hawkish outlook is seen as positive/bullish for the EUR, while a dovish one is seen as negative/bearish.
Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.
ECB NEWS & ANALYSIS
FED NEWS & ANALYSIS
The EUR/USD (or Euro Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The popularity is due to the fact that it gathers two main economies: the European and American (from United States of America) ones. This is a widely traded currency pair where the Euro is the base currency and the US Dollar is the counter currency. Since the EUR/USD pair consists of more than half of all the trading volume worldwide in the Forex Market, it is almost impossible for a gap to appear, let alone a consequent breakaway gap in the opposite direction.
Normally, it is very quiet during the Asian session because economic data that affects the fundamentals of those currencies is released in either the European or U.S. session. Once traders in Europe get to their desks a flurry of activity hits the tape as they start filling customer orders and jockey for positions. At noon activity slows down as traders step out for lunch and then picks back up again as the U.S. comes online. If there is important U.S. data we can expect quiet markets just ahead of the number. U.S. economic news have the ability to either reinforce an existing trend or reverse it depending on by how much it missed or beat expectations with the EUR/USD news. By 5:00 GMT liquidity leaves the market once again as European traders close out positions and head home.
EURUSD 2018 YEARLY FORECAST
The GBP/USD (or Pound Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs worldwide. This group also includes the following currency pairs: EUR/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The pair is also called 'The Cable', reffering to the first Transatlantic cable that was crossing the Atlantic Ocean in order to connect Great Britain with the United States of America. This term was originated in the mid-19th century and it makes GBP/USD one of the oldest currency pairs in the world.
The popularity of the Pound Dollar is due to the fact that represents two strong economies: British and American (from United States of America). The Cable is a widely observed and traded currency pair where the Pound is the base currency and the US Dollar is the counter currency. After the result of the Brexit referendum, where the majority of the British voted to abandon the European Union, GBP/USD has been suffering some turbulence in the Forex market as a consequence of the associated risks of leaving the single market.
The USD/JPY (or US Dollar Japanese Yen) currency pair is one of the 'Majors', the most important pairs in the world. Japanese Yen has a low interest rate, normally used in carry trades, that's why is one of the most trades currencies worldwide. In the USD/JPY the US Dollar is the base currency and the Japanese Yen is the counter currency. The pair represents American (from United States of America) and Japanese economies.
Trading the USD/JPY currency pair is also known as trading the "ninja" or the "gopher", although this last name is more frequently used when reffered to the GBP/JPY currency pair. The US Dollar Japanese Yen usually has a positive correlation with the following two pairs: USD/CHF and USD/CAD. The nature of this correlation is dued to the fact that both currency pairs also use the US Dollar as the base currency, such as USD/JPY. The value of the pair tends to be affected when the two main central banks of each country, the Bank of Japan (BoJ) and the Federal Reserve Bank (Fed), face serious interest rate differential.