- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot are bearish (44% long / 56% short)
- The closest resistance for this pair is located at 1.1135
- At the same time, the nearest support is currently placed at 1.1058
- Upcoming events in the next 24 hours: ECB Monetary Policy Meeting Accounts, US Non-Farm Payrolls (Jun), Unemployment Rate (Jun), Unemployment Claims (Jun 26) and Factory Orders (May), China Services PMI (Jun)
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While Greece continues to hit all headlines, Euro zone manufacturing activity rose to the highest level in more than a year in June, as growth increased in Germany, France, and the Netherlands. According to Markit, Euro zone manufacturing PMI climbed to 52.5 in June, up from 52.2 a month earlier. The German manufacturing sector gathered steam in June, with the corresponding gauge rising 51.9 points, compared with 51.1 in May.
In France, business activity in the manufacturing sector returned to growth in the reported month following a contraction which lasted for more than a year. The French manufacturing PMI came in at 50.7, up from 49.4 seen in May. The PMI for the Italian manufacturing sector increased to 54.1 points in June.
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Non-farm payrolls to show US labour market was strong in June
Thursday is going to be an important day in terms of US fundamental data releases. All market attention is currently focused on the labour market statistics, which is due at 12:30 PM GMT. US employers have probably added 230,000 new jobs in June, down from an unusually positive number of 280,000 in May. The jobless rate is expected to fall back down to 5.4%, while claims for unemployment benefits are likely to stay widely unchanged last week. In the meantime, US factory orders data is due at 14:00 PM GMT, but they are estimated to slump by 0.5% in May, thus decreasing for a second consecutive month.Read More: Fundamental Analysis
EUR/USD likely to lose value, trading range to narrow down
Judging from EUR/USD's developments that took place since May of the previous year, the pair is clearly trading downwards on a long-term chart. At the same time, it seems that now the pair is being bounded between the 2014 low and long-term downtrend line, meaning that it is currently hovering inside the descending triangle pattern. Moreover, this pattern implies a narrowing trading range, while the break-out point can be reached by the end of September. In the medium-term the common European currency may show spikes as high as 200-day SMA and 2005 low at 1.16, but the downtrend will remain the main resistance and should be capable of pushing the cross back in the direction of 1.05-1.10 area in the long run.Daily chart
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As expected, EUR/USD's bears managed to send the pair to the near-term target around 1.1060, where 100-day SMA and weekly S1 are currently placed. At the moment the Euro is projected to rebound moderately from the mentioned support lines, but the overall sentiment is still negatively biased towards the common currency. In spite of any possible advance in the short-term, bears will aim to push the Euro in the direction of Jun 29 low at 1.0954.
Hourly chart
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Read More: Technical Analysis
EUR/USD sentiment neutral, pending orders remain bearish
Meanwhile, the portion of pending orders to buy the Euro against the US Dollar in 100-pip range from the spot price added one percentage point from yesterday and reached the 44% mark.
It proclaims that in case the EUR/USD rises in value, the pair's near-term gains can be capped by the 55-day SMA, currently at 1.1135. On the other hand, a downward development of the Euro is likely to be extended down to the June 29 low / weekly S2 at 1.0954.
Spreads (avg,pip) / Trading volume / Volatility
Community suggests the Euro will decline against the US Dollar this week
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Read More: Community Forecasts
geula4x, one of the community members participating in the survey, motivates his bearish outlook towards the single currency by saying that "EUR/USD opened this week with a big gap down. Greece has not reached an agreement with creditors, plus there is a referendum scheduled for next Sunday. All this suggests that Greece may leave the Euro Zone. Therefore, bears seem better positioned to take control this week. Resistance lies around 1.1220, Friday's daily high. Support lies around 1.0850, which has held price between May 26 and 28."
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Jun 2 and Jul 2 expect, on average, to see the currency pair around 1.12 by the end of September. Though the majority of participants, namely 53% of them, believe the exchange rate will trade below this level in ninety days, with 34% alone seeing it below 1.08. Alongside, only 20% of those surveyed reckon the price will trade in the range between 1.12 and 1.18 by the end of September of this year.
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