- EUR/USD bulls in control at the start of this week in a risk-postive market place.
- All eyes will now turn to a number of critical events, including the Fed and Nonfarm Payrolls.
EUR/USD remained elevated on Monday in a positive risk environment as traders picked up on the solid performances in global equities. It has been an otherwise relatively quiet start to what indeed should be an eventful week ahead.
EUR/USD was ending on Wall Street around its highs for the day having travelled from a low of 1.1076 to a high of 1.1106, ending some 0.20% higher on the day. Corporate earnings are a focal point this week with 162 S&P 500 companies due to release quarterly financial results - The S&P 500 index surpassed its previous intraday all-time high which lent support to the euro while the EU granting the UK a Brexit extension until 31 January also helped to bring about some risk appetite.
As for the data for the day, there was little to go on at the start of the week, with just a 0.3% month-on-month fall in September wholesale inventories undershooting expectations of a 0.2% gain, while from the euro area, we had some mixed messages in money supply coming in slightly below expectations with a5.5% year-on-year rise in M3. Meanwhile, looking head and besides Brexit politics and central banks, this week brings a handful of data releases, including US and euro area Q3 GDP, euro area inflation, various ISM/PMIs, and US non-farm payrolls sure to shake things up for the single currency.
Eyes on the Fed
Commenting on the Federal Open Market Committee, (FOMC), for this week, analysts at TD Securities explained that they are expecting the Fed to lower rates by 25bp, delivering the third consecutive rate cut since July. "The FOMC is likely to communicate patience in deciding future policy moves after next week's cut as they assess the impact of the three cuts they have already delivered. We look for the Fed to temporarily pause before resuming rate cuts in Q1 2020."
EUR/USD levels
From a technical standpoint, the single unit is struggling to get over a 23.6% retracement of its latest bullish run. Valeria Bednarik, the Chief Analyst at FXStreet notes that the 38.2% retracement of the same advance has been providing immediate support at 1.1065, adding:
"In the 4-hour chart, a bearish 20 SMA converges with the mentioned Fibonacci resistance, while technical indicators remain within negative levels, although lacking directional strength. The overall stance is negative, although little should be expected on this first day of the week."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds below 1.0750 ahead of key US data
EUR/USD trades in a tight range below 1.0750 in the European session on Friday. The US Dollar struggles to gather strength ahead of key PCE Price Index data, the Fed's preferred gauge of inflation, and helps the pair hold its ground.
GBP/USD consolidates above 1.2500, eyes on US PCE data
GBP/USD fluctuates at around 1.2500 in the European session on Friday following the three-day rebound. The PCE inflation data for March will be watched closely by market participants later in the day.
Gold clings to modest daily gains at around $2,350
Gold stays in positive territory at around $2,350 after closing in positive territory on Thursday. The benchmark 10-year US Treasury bond yield edges lower ahead of US PCE Price Index data, allowing XAU/USD to stretch higher.
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.
US core PCE inflation set to signal firm price pressures as markets delay Federal Reserve rate cut bets
The core PCE Price Index, which excludes volatile food and energy prices, is seen as the more influential measure of inflation in terms of Fed positioning. The index is forecast to rise 0.3% on a monthly basis in March, matching February’s increase.