- Commands to buy the Euro versus the US Dollar in 100-pip range are negative (33% bullish / 67% bearish)
- The closest resistance for this pair is located at 1.0882
- At the same time, the closest support is currently placed at 1.0759
- Upcoming events on April 1: ECB Non-Monetary Policy Meeting, Euro zone and US Manufacturing PMI (Mar), US ADP Employment Change (Mar)
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Deflationary pressure in both Germany and Spain eased in March, helped by recovery from the sharpest slump last year amid falling oil prices. Consumer price index in the fourth largest economy of the Euro zone was released ahead of expectations, declining 0.7% on the annual basis, against a forecast of a 0.9% drop and up from a 1.2% decrease in February. Alongside, German annual inflation came out at 0.3% this month, up from 0.1% in February and in line with the majority of analysts' predictions.
Meanwhile, economic sentiment in the common currency bloc gained further ground and hit its strongest level in more than three years. The reading of consumer confidence, calculated by the European Commission, advanced to 103.9 points in the current month from 102.3 in the preceding month, the biggest mark since June 2011.
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ECB to hold non-monetary policy meeting on Wednesday
Tomorrow, the European Central Bank's Governing Council will gather together in order to discuss current issues that are taking place in the Euro zone's economy. Alongside, this meeting is not assumed to bring any changes in monetary policy stance. Among important topics, the ECB will most probably review progress on Greece, which is struggling to prepare sufficient reform projects in order to unfreeze its current bailout funds.Read More: Fundamental Analysis
EUR/USD likely to lose value with growing trading range
Judging from EUR/USD's developments that took place since July of the previous year, the pair is clearly trading downwards with a significant negative slope. At the same time, mid-March movements of the Euro have also confirmed a widening trading range of this currency pair, meaning it is currently hovering inside the broadening falling wedge pattern. By the end of April, the common European currency is expected to surge up to the 1.17 mark where 2005 low and 38.2% Fibonacci retracement will most probably push the cross back in the direction of 1-1.05 area. In the meantime, the Euro may hit 1:1 against the US Dollar as soon as by the end of July 2015. However, a presence of dense zone of technical levels may also considerably influence the time-frame for this important event.Daily chart
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A strong resistance area, created by weekly PP and monthly S2, managed to send the common currency downwards on Monday. The pair fell closer to the next support level represented by the 2003 low / weekly S1 around 1.0760, also by crossing the round level of 1.08. However, EUR/USD is not expected to breach this demand with ease, as the second obstacle is located just 40 pips below 2003 low at 1.0709 (monthly S3). Therefore, the pair is forecasted to stay above 1.0750 in course of Tuesday.
Hourly chart
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Read More: Technical Analysis
EUR/USD sentiment and pending orders are negative
Additionally, pending orders to buy the Euro against the US Dollar in 100-pip range from the spot are accounting for 33% in the morning today, down seven percentage points during past 24 hours. It proclaims that in case the EUR/USD rises in value, the pair's potential rebound can be limited by the weekly PP at 1.09. On the other hand, a potential downward development of the Euro is considered to be extended down to the monthly S3 at 1.0709.
Spreads (avg,pip) / Trading volume / Volatility
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Feb 28 and Mar 31 expect, on average, to see the currency pair just below 1.08 by the end of June. Though the majority of participants, namely 56% of them, believe the exchange rate will drop considerably below this mark in ninety days, with 41% alone seeing it below 1.04. Alongside, 24% of those surveyed reckon the price will trade in the range between 1.08 and 1.14 by the end of June of this year.
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