- SWFX market sentiment is 51% bearish
- Trader pending orders are 59% to sell
- Pair opened Wednesday's session at the 1.1053 level
- Aggregate daily technical indicators bet EUR/USD will decline
- Economic events to watch over the next 24 hours: EU Industrial Production; US FOMC Dudley Speaks; US FOMC George Speaks; US JOLTS Job Openings; FOMC Meeting Minutes
According to the data released, the ZEW survey of economic expectations for the Eurozone advanced to 12.3 for October from 5.4 in September showing the highest reading for four months. Also, there was a small rise in the Eurozone inflation reading with a big number of economists expecting short-term interest rates to remain on hold, although the number expecting a further cut was still slightly higher than those expecting an increase. Nevertheless, the data overall continues to suggest a very slow improvement in the overall Eurozone outlook. The German ZEW index advanced to 6.2 for October from 0.5 the previous month. Overall, the index is still far below the long-term average of 24.1 highlighting reservations surrounding the gunancial sector having a negative impact. The Current Conditions Index went up to 59.5 this month from 55.1 in September, above expectations for an increase to 55.5. In the meantime, European stock markets were trading mixed. The benchmark Euro Stoxx 50 dropped 0.15%, Germany's DAX gave up 0.17%, France's CAC 40 went up 0.06%, while London's FTSE 100 lowered to 0.01%
US employment growth slowed unexpectedly last month, official data revealed on Friday. According to the US Department of Labor, US private companies created 156,000 new jobs in September, while market analysts expected the economy to add 171,000 jobs in the reported month. Meanwhile, the previous month's reading was revised up to 167,000 from the originally reported gain of 151,000. Although the report suggested the economic expansion was still remaining on track, the chances of an interest rate hike at the Federal Reserve's policy meeting next month decreased markedly. However, the odds of a December rate remained quite high, despite the disappointing, despite today's disappointing jobs report. The unemployment rate grew to 5.0% in September, as more Americans re-joined the labor force. Average hourly wages rose to an annualized rate of 2.6% last month, in line with analysts' expectations, whereas the average work week grew 0.1 to 34.4 hours. A broader measure of unemployment, which includes part-time workers and people who stopped searching for jobs, held steady at 9.7% in September. Professional and job services created 67,000, health care and restaurants added 33,000 and 30,000 jobs, respectively, contributing most to the September job growth.
Upcoming fundamentals: Minor EU data and FOMC Minutes
Today it is all about the Fed. However, minor data will be released in the EU, as the union's Industrial Production data is set to be released at 9:00 GMT. At 12:00 FOMC Member Dudley will give a speech, and he will be followed by George at 13:40 GMT. Between the Federal Reserve events, US JOLTS Job Openings will be published at 14:00 GMT. The main event will be the FOMC Meeting Minutes, which will be released to the public at 18:00 GMT and reveal information regarding the next rate decision of the FOMC.
EUR/USD plummets below 1.1050
Daily chart: The common European currency traded below the 1.1050 level against the Greenback on Wednesday, as it had found resistance in the second weekly support level at 1.1043. Previously, as the currency exchange rate slowly moved through the first weekly and monthly support at 1.1121 and 1.1133, it plummeted down to the 1.1043, as soon as the before mentioned support levels were passed. It is most likely that the currency pair will move lower to mark new low levels, as it nears the Brexit low level.Daily chart
Hourly chart: The hourly chart reveals that the weekly and monthly first support levels were hindering the upcoming fall for about twelve hours. Afterwards, the currency exchange rate gradually moved to the next support cluster, where it remained on Wednesday morning. Combined this information suggests that the rate will be slowed down by the cluster before another fall.
Hourly chart
Traders move into neutral zone
SWFX traders are almost neutral on the pair, as 51% of open positions are short on Wednesday. In the meantime, pending commands are 59% to sell the Euro.
OANDA traders have become bullish on Wednesday, as 56.79% of open EUR/USD positions are long. In the meantime, SAXO Bank clients remain bearish. However, the bearishness is lower than previously, as open short positions now add up to 53.24% compared to 58.52% during the previous trading session.