- SWFX market sentiment is 53% bearish
- 70% of pending orders in 100-pip range are set to SELL
- 50% of traders are bearish on the Dollar
- Upcoming Events: Quiet Monday
Following ECB meeting, the pair entered into a red zone and has successfully travelled from the upper till the bottom trend-line of a dominant descending channel. Today the Euro is expected to try to recover against the Dollar. However, that would be difficult, as the northern side is protected by a combination of the monthly S1, weekly PP and the 55-hour SMA.
The US GDP data contributed to the temporary decline of EUR/USD on Friday. The Euro lost 0.11% against the Greenback, though the following report on the US consumer sentiment caused 33 base points gain, putting the pair to 1.1613, where it returned again by the session end.
The Commerce Department revealed that the US gross domestic product marked a 3.0% yearly growth pace in the third quarter, fuelled by higher business investment, while consumer spending growth eased slightly as incomes were hurt by hurricanes. Separate report showed that the US consumer sentiment remained at lofty levels over the course of October and was expected to improve further. Meanwhile, economists anticipate the Fed to raise rates one more time in December.
Silent Monday
Although the rest of the week will be full of various macroeconomic data releases, today is expected to pass quite quietly for swing traders.
EUR/USD starts new week near 1.1614
In result of the previous trading session, the currency exchange rate slipped through the updated 23.6% Fibonacci retracement level at 1.1679 and, in essence, made a rebound from the bottom trend-line of a dominant descending channel. Due to absence of any fundamental data releases, bulls are likely to try to return the rate back to 1.1643, at minimum. However, the further recovery of the Euro seems unlikely because of a combined resistance formed by the monthly S1 at 1.1658, the weekly PP at 1.1674 and the falling 55-hour SMA. The southern side, in contrast, remains barrier-free. In addition to that, there is couple of fundamental factors that incite further appreciation of the Dollar, such as Donald Trump's tax reform and possible nomination of John Taylor, as the Fed chair.
Hourly Chart
General fundamental background points out on further appreciation of the Dollar against all major currencies. This trend falls in line with the senior descending channel that guides movement of the pair. In the upcoming days the pair is likely to reach its bottom boundary. From trade patterns perspective, afterwards the rate should make a rebound. However, this recovery of the Euro might be compromised, depending on content of the FOMC Statement that will be released on Wednesday.
Daily Chart
Traders remain bearish
In result of the previous trading session the bearish market sentiment decreased, as 53% of open positions are short now.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 61% bearish and the Dollar is 50% bearish.
Traders of OANDA remain bearish, as 59% (-1%) of open positions are short. Meanwhile, SAXO are neutrally bearish on this currency pair with 52% (+1%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility