- SWFX market sentiment is 56% bearish
- Trader pending orders are 56% to sell
- Pair opened Tuesday's session at 1.0694
- Upcoming Events: EU CPI Flash Estimate; EU Preliminary Flash GDP; US Employment Cost Index; US Chicago PMI; US CB Consumer Confidence
Bank lending to the Euro zone's companies rose at the strongest pace in more than four years in December, while the total amount of money in circulation advanced more than expected, official data revealed on Friday. According to the European Central Bank, corporate bank loans in the 19-member state currency bloc climbed 2.3% in the reported month, following November's upwardly revised gain of 2.1%. Furthermore, household lending rose 2.0% in December, the largest gain since the middle of 2011, compared to the preceding month's 1.9% increase. The figure came in right in line with analysts' expectations. The Central bank also released its monthly data on the amount of money in circulation, which is an important indicator for predicting future economic activity. According to the Bank's report, the M3 Money Supply climbed 5.0% on an annual basis in the same month, following the prior month's 4.8% and slightly surpassing economists' forecasts for 4.9%.
Other data released by Destatis showed that German import inflation accelerated at a stronger than expected pace last month. Import prices climbed 1.9% in December, after growing just 0.7% in the previous month. Markets expected prices to increase 1.3% in the reported month.
Upcoming events: Various data releases
Tuesday is set to be a busy day for fundamental data releases, as releases marked with medium to high impact have flooded the economic calendars. First of all at 10:00 GMT traders have to look at the package of data coming out from the EU. The package will include EU CPI Flash Estimate, EU Core CPI Flash Estimate and the EU Preliminary Flash GDP. Data, which will affect the strength of the US Dollar will be coming in the second half of the day. At 13:30 GMT the US Employment Cost Index is set to be published. At 14:45 GMT the Chicago PMI will be out. Afterwards, at 15:00 GMT the US CB Consumer Confidence is set to be released.
EUR/USD below 1.07 mark
Daily Chart: On Tuesday morning the EUR/USD currency exchange rate remained rather flat just below the weekly PP, which is located at 1.0709. However, the course of the rate can be forecasted. Previously, during Monday's trading the pair fell down to 1.0620 mark and rebounded there. As a result a surge began which lasted into Tuesday and reached the weekly PP. Afterwards the rate bounced off of the resistance level and set a course southward. Due to that reason the pair is set to fall down to the weekly S1 at 1.0644. Although, the decline is set to be hindered by the 20-day SMA at 1.0652.Daily chart
Hourly chart: The hourly chart reveals that the currency exchange rate, after bouncing off the weekly PP, fell below a cluster of all of the SMAs used in technical analysis by Dukascopy. If the SMAs manage to provide enough resistance to the EUR/USD pair, then the pair is surely set to fall down to the weekly S1, which is at 1.0644.
Hourly chart
SWFX traders remain bearish
SWFX traders remain bearish, as 56% of trader open positions are short on Tuesday. In the meantime, 56% of trader set up orders are set up to sell the Euro.
OANDA traders have increased their bearish outlook, regarding the pair, as 58.00% of open EUR/USD positions were short on Tuesday, compared to 54.22% on Monday. Meanwhile, SAXO bank traders also are bearish, as 63.33% of open positions are short, compared to 62.95% previously.