- SWFX market sentiment is 70% bearish
- 52% of pending orders in 100-pip range are to SELL the Euro
- 72% of total pending commands are to sell the Euro
- Upcoming events: German Preliminary CPI m/m, Eurozone's Preliminary Flash GDP q/q, US CB Consumer Confidence, US President Trump to speak
The Dollar was little stronger against the US Dollar, following the US economic data. The EUR/USD currency pair declined 10 pips or 0.08% to decrease further, but managed to return to the 1.2380 area.
The US consumer spending strengthened in December amid higher demand for services and goods, though an increase came at the cost of savings, which fell to the lowest level in 10 years in a worrying sign for future economic growth and consumption. The report indicated that the PCE Price Index, the Federal Reserve's preferred measure of inflation, increased 0.2% in December after a 0.1% gain. Meanwhile, consumer spending added 0.4% in the reported month from an upwardly revised 0.8% in November.
US Consumer Confidence, Trump to speak
The economic calendar for this session includes several noteworthy fundamentals. In terms of the Euro, Germany is to release its preliminary CPI for this month, while Eurozone will publish the Preliminary Flash GDP for Q4 2017 at 1000GMT.
The US Conference Board Inc is set to publish the Consumer Confidence index at 1500GMT. In addition, the US President Donald Trump is due to deliver a speech titled ‘The State of the Union Address' early on Tuesday at 0200GMT.
EUR/USD breaches trend-line
As previously expected, the notable resistance of the 55-hour SMA and the monthly R3 circa 1.2436 stopped any attempts for the common European currency to strengthen against the Greenback within the last session. Thus, the rate pushed lower and breached the three-week upward-sloping trend-line. It did return near the given line late on Monday, but failed to gain enough bullish momentum to return above the 1.24 mark.It is likely that the pressure of the 55– and 100-hour SMAs and the weekly PP in this area results in a slight movement south towards the 200-hour SMA. The pair should remain between these moving averages until some fundamental events cause a breakout.
The general tendency, however, should nevertheless be southwards.
Hourly Chart
Following a breakout of the weekly PP on Monday, the common European currency continues to advance southwards against the US Dollar. Given that the nearest support is formed solely by the weekly S1 at 1.2251, it is unlikely that this mark is reached today.
By and large, given that daily technical indicators share the same sentiment, this week might finally mark a period of decline.
Daily Chart
Market sentiment is strongly bearish
The bearish market sentiment has remained unchanged for the second consecutive session with 70% short positions.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 72% bearish and the US Dollar is 63% bullish.
OANDA traders remain bearish, as 64% of open positions are short (+1%). Saxo Bank clients are likewise increasingly bearish on the pair with 60% short positions (+1%).
Spreads (avg, pip) / Trading volume / Volatility