© Dukascopy Bank SA
Last week, the most popular pair on the foreign exchange market managed to recover some losses it accumulated during a number of weeks before. Starting a new trading week on Monday at a rather low level of 1.2515 due to Friday's drop, the single European currency began gaining value to reach the 1.2792 mark in the morning on Thursday, even surpassing the monthly pivot point just below it. At the same time, the currency pair moved down to close at 1.2629 on Friday's evening. It is worth pointing out that the week was not rich on fundamental statistics both from Europe and the United States. Among few important indicators, German factory orders slipped 5.7% in August, while industrial production declined. Manufacturing sector in France, however, performed better than expected, by showing no growth, despite negative forecasts. Therefore, last week's movements of the EUR/USD pair can be explained as a short-term correction after weeks of downward trend. Market participants, however, expected this correction to happen in more than 53% of all cases.
Meanwhile, this week the sentiment among Dukascopy traders deteriorated to approach average level of several last weeks, as now only 42% of them are waiting for the pair to advance from Monday to Friday. Average market expectation, however, moved slightly up to reach the 1.2650 level on Friday, October 17. Moreover, 55% of all votes are set in range between 1.25 and 1.2750, meaning that the pair is likely to hover around current levels for some time in the future. Traders can pay attention to Mario Draghi's, ECB President, speech in Frankfurt on Wednesday and German ZEW Economic Sentiment a day earlier. From American side, core retail sales for September are due to be released on Wednesday, while industrial production data will be published on October 16.
© Dukascopy Bank SA