- SWFX market sentiment is 59% bearish
- Trader pending orders are 52% bearish
- Pair opened Thursday's session at 1.0888
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Upcoming Events: US Unemployment Claims; US preliminary Nonfarm Productivity; US Preliminary Unit Labor Costs; US Trade Balance, US Factory Orders; ECB President Draghi's Speech
The Fed has pushed the EUR/USD pair below the 1.09 mark, and it seems that it might stay at that level. The FOMC statement provided an expected affect in most cases, as it provided a push higher for the US Dollar. In general, the FOMC has provided the push for the expected decline of the Euro against the US Dollar.
As markets expected, the US Federal Reserve left its monetary policy unchanged at its meeting on Thursday. However, policymakers signalled that "the path of gradual tightening" remained in play despite an economic slowdown registered in the March quarter. Although the Fed did not provide any clues on the timing of the next interest rate hike. Nevertheless, according to market forecasts, the next hike will likely appear in June. Solid inflation growth and the strong labour market pleased policymakers and offset sluggish economic growth. The next Fed meeting will take place on June 13-14 in Washington.
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Upcoming events: Draghi Speaks
Thursday is set to be full of various minor impact US data releases in the middle of the day, and Mario Draghi is set to give a speech at the end of the day. First data set from the US will be published at 12:30 GMT, as the US Unemployment Claims, Preliminary Nonfarm Productivity, Preliminary Unit Labor Costs and the US Trade Balance will be out at that time. Afterwards, at 14:00 GMT the US Factory Orders data will be out. However, for the EUR/USD pair traders it will be of more importance to listen to the ECB President Mario Draghi's speech at 16:30 GMT.
Read More: Fundamental Analysis
EUR/USD retreats below 1.09 mark
Due to the hawkish announcement by the Fed on Wednesday, the common European currency was trading below the 1.09 mark against the US Dollar on Thursday morning. The pair seemed to have rebounded against the support, which is provided by the weekly PP at 1.0890 level. If the situation does not change and a surge persists, the currency exchange rate will reach the weekly R1, which is located at the 1.0958 level. On the other hand, the pair might decline to the support cluster below it that begins at the 1.0835 level.
Daily chart
The hourly chart reveals that the currency exchange rate is set to face the resistance of all of the simple moving averages, which are used in the Dukascopy Research team's analysis. Starting from the 200-hour SMA near 1.0897 and ending with the 55-hour SMA at 1.0912, this cluster of resistance should be taken into account.Hourly chart
Read More: Technical Analysis
Market sentiment strongly bearish
Traders remain bearish, as 59% of open positions are short on Thursday. Meanwhile, 52% of trader set up orders are to sell the Euro.
OANDA traders have decreased their bearish sentiment, as 61.15% of trader open positions are short on Thursday, compared to 64.28% previously. Moreover, SAXO bank clients have done the same, as 61.25% of open positions are short, compared to the 64.76% positions on Wednesday.
Spreads (avg, pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.09 in August
© Dukascopy Bank SATraders, who were questioned on their longer-term views on EUR/USD between April 4 and today expect, on average, the currency pair to trade around 1.09 in early August. In general, 49% of participants believe the exchange rate will be above 1.10 in ninety days, and 27% see it above 1.12. In the meantime, 7% of those surveyed reckon the pair will be at parity or below.