- SWFX market sentiment is 51% bullish
- Trader pending orders are 58% to sell
- Pair opened Tuesday's session at 1.0581
- Upcoming Events: US Trade Balance
Economic activity in the US services sector rose unexpectedly last month, official figures showed on Friday. The Institute for Supply Management reported its Purchasing Managers' Index for the services sector climbed to 57.6 in February, while market analysts expected the Index remain unchanged from the prior month's reading of 56.5 during the reported period. Any reading above the 50-point level indicates activity expansion in the services sector. Furthermore, the Non-Manufacturing Business Activity Index came in at 63.6, the highest level since February 2011, up from the previous month's 60.3. Data also showed the New Orders Index increased to 61.2, the highest since August 2015, following January's 58.6. The ISM said 16 out of 18 industries reported growth last month, adding that the share of companies expressing a positive outlook for the future rose markedly last month despite the existing uncertainty in the US economy. Economic activity contracted in the information industry and the real estate, rental and leasing industry in February.
After the release, the US Dollar hit its intraday high of 114.54 against the Japanese Yen but failed to maintain its gains as investors awaited a speech by the Fed Chair Janet Yellen in the day
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Upcoming events: US Trade Balance
At 13:30 GMT on Tuesday the US will release their trade balance data. The data release will be covered by the Dukascopy research team. However, the analysts will concentrate on the USD/CAD currency exchange rate during the release, as the US data will be released simultaneously with its Canadian counterpart.
Read More: Fundamental Analysis
Euro finds support
Daily Chart: The common European currency trades against the US Dollar just as forecasted yesterday, as the currency exchange rate fell down to the weekly PP, which is located at the 1.0582 level. There the pair found support on Tuesday morning and began a rebound. The rate might surge up to the monthly PP, which is located at 1.0633. However, before that the currency pair faces the combined resistance of the 20 and 55-day SMAs, which are located respectively at 1.0598 and 1.0603 levels. On the other hand traders might watch for another attempt of the Buck to surge and pass the weekly PP.Daily chart
© Dukascopy Bank SA
Hourly chart: The hourly chart shows that the currency exchange rate was searching for support in the weekly PP for half a day. However, most recently the currency exchange rate broke off from the weekly PP to the upside. Moreover, with that move the pair broke the descending channel, which had guided the rate from the monthly PP at 1.0633 to the weekly PP at 1.0582. Regarding resistance on the hourly chart, the only notable level is the upper Bollinger band, which seems to have begun to bend to the upside.
Hourly chart
© Dukascopy Bank SA
Read More: Technical Analysis
SWFX sentiment almost neutral
SWFX traders remain neutral bullish on the pair, as 51% of open positions are long on Tuesday. Meanwhile, 58% of trader open positions are to sell the Euro.
OANDA traders remain slightly bearish, as only 51.08% of trader open positions are short at the marketplace, compared to 51.11% previously. In addition, SAXO bank clients have a similar stance, as 51.35% of open positions are short, compared to 53.47% on Monday.
Spreads (avg,pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.06 in April
Traders, who were questioned on their longer-term views on EUR/USD between February 7 and March 7 expect, on average, the currency pair to trade around 1.06 by the start of April. In general, 49% (-2%) of participants believe the exchange rate will be generally below 1.06 in ninety days, and 26% see it below 1.02. In the meantime, 13% (+7%) of those surveyed reckon the pair will trade above 1.12 in three months. © Dukascopy Bank SA