- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot changed to strongly positive (65% bullish / 35% bearish)
- The closest resistance for this pair is located at 1.1217
- At the same time, the closest support is currently placed at 1.1059
- Upcoming events on May 13: France GDP (Q1), Germany GDP (Q1) and CPI (Apr), Italy GDP (Q1), Euro zone GDP (Q1) and Industrial Production (Mar), ECB Monetary Policy Meeting Accounts, US Retail Sales (Apr)
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Germany's economy, the Euro zone's powerhouse, could expand more in 2015 that the 1.6% forecast in April if lower energy prices and the European Central Bank's quantitative easing programme provide a bigger support than estimated, the International Monetary Fund acknowledged.
Private consumption will be the main growth catalyst for the German economy in 2015 as workers benefit from robust wage gains, while net exports will also provide support, according to the IMF. Last month the German government upgraded its growth forecasts for 2015 and 2016 to 1.8% as both sentiment indicators and fundamentals pointed to an improving trend, buoyed by the weaker Euro, which support exports, as well as low energy prices, which increase German consumers' purchasing power.
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Euro zone's GDP advance to show positive QE impact
Wednesday of this week will be full of different important fundamental statistics. At first, many Euro zone's countries will release the GDP numbers for the first quarter of this year. While Germany is currently predicted to grow by 0.5%, French and Italian economies have probably gained 0.4% and 0.2% on a quarterly basis, respectively. Later during the day US will publish the retail sales data, as they are estimated to add 0.2% in April, following a 0.9% jump a month before.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 June, the common European currency may surge up to the 1.15 mark where long-term downtrend will most probably push the cross back in the direction of 1.05-1.10 area. In the meantime, the Euro's parity against the US Dollar is not off the table in the long-term.Daily chart
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Unchanged from yesterday's outlook, EUR/USD is still estimated to be capable of rebound in the near-term. The pair stayed above 1.1150 on Monday, and unless it hovers above the March high at 1.1052 the forecast may remain fairly positive. In addition to that, the mentioned demand line guards next supports at 1.10 (monthly PP) and 55-day SMA at 1.09. Meanwhile, daily technical indicators are giving strong signals to buy the Euro at the moment.
Hourly chart
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EUR/USD sentiment is bearish, while pending orders climb above 60%
At the same time, pending orders to buy the Euro currency against the US Dollar in 100-pip range from the spot price have unexpectedly gained 16% on a daily basis and reached the 65% mark this morning. It proclaims that in case the EUR/USD rises in value, the pair's potential rebound can be extended up to the 23.6% Fibonacci retracement at 1.1294. On the other hand, a downward development of the Euro is assumed to be capped by the March high at 1.1052.
Spreads (avg,pip) / Trading volume / Volatility
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Apr 12 and May 12 expect, on average, to see the currency pair around 1.09 by the end of August. Though the majority of participants, namely 48% of them, believe the exchange rate will be still below the 1.08 level in ninety days, with 28% alone seeing it below 1.04. Alongside, 23% of those surveyed reckon the price will trade in the range between 1.08 and 1.14 by the end of August of this year.
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