- SWFX market sentiment is 53% bullish
- Trader pending orders are 64% to sell
- Pair opened Friday's session at the 1.0889 level
- Aggregate daily technical indicators bet EUR/USD will surge
- Economic events to watch over the next 24 hours: FOMC Member's Fischer's Speech; Preliminary UoM Consumer Sentiment
The number of Americans filing for unemployment aid dropped more than expect last week, official figures showed on Thursday. According to the US Department of Labor, initial jobless claims fell 11,000 to 254,000 in the week ended November 4, down from the preceding week's 267,000 filings, while market analysts anticipated an increase of 2,000 to 267,000. This marked the 88th week of initial claims below the 300,000 level, the longest streak since 1973. The four-week moving average of claims increased 1,750 to 259,750 in the reported week. Thursday's data also showed that continuing claims grew 18,000 to 2,041,000 in the week ending October 29, whereas their four-week moving average declined to 2,039,500, the lowest level since July of 2000. After the release, the EUR/USD pair fell 0.09% to 1.0902, whereas it touched its highest level of 1.1298 on Wednesday after the results of the presidential race were announced. Last week's initial jobless claims together with the NFP report released on Friday have strengthened odds for a December rate hike, despite Donald Trump's surprise victory in the US Presidential elections, which sent shockwaves across the world.
Donald Trump's election as the 45th president of the United States sent shock waves across the world. His victory allowed the Republic Party to maintain the Senate, as well as win the White House. According to the final figures, in the presidential race of 2016 Trump won 276 electoral votes. Despite the post-election uncertainty, the US economy is set to continue its expansion at a rate of 2%. Moreover, analysts still expect a rate hike from the Federal Reserve in December, as markets are likely to stabilize ahead of the monetary policy meeting. Once the news broke, the Mexican Peso dropped more than 13%, hitting its overnight low, whereas the price of gold advanced 4.9% to $1,337.4 per ounce. European stock markets fell around 2.3%, compared to a 9% plunge after Britain's decision to leave the European Union. However, European stocks managed to finish higher, with the FTSE rising around 1% after falling 2% at the start of the trading day. Separately, the Energy Information Administration reported on Wednesday that US crude oil inventories increased 2.4 million barrels in the week ended November 4, following the preceding week's rise of 14.4 million barrels and surpassing the 1.3 million barrel gain forecast.
Upcoming fundamentals: FOMC speech and consumer sentiment
It is a banking holiday in Canada and the US, which means that we might not get data during the day from the US. However, there are two events, which will affect the strength of the US Dollar. At 14:00 GMT FOMC Member Fischer is set to give a speech and at 15:00 GMT keep an eye out for the Preliminary UoM Consumer Sentiment index.
EUR/USD trades below Brexit low level
Daily chart: The common European currency surged against the US Dollar on early Friday morning, as the currency exchange rate attempted to break the resistance put up by the Bexit low level at 1.0911. The pair found support during Thursday's trading session in the second weekly support level at 1.0866. Afterwards the currency pair rebounded and began the surge, which followed into Friday. Traders should watch the rate for a reversal or a break of the resistance, which would reveal the rate's further movement.Daily chart
Hourly chart: The hourly chart for the EUR/USD currency pair reveals that the fall below the Brexit low level occurred at 9:00 GMT. Afterwards the pair fluctuated between the Brexit low and the second weekly support level at 1.0866 until 2:00 GMT on Friday. During that time the pair first broke above the Brexit's resistance, as the rate attempted to break through it since 2:00 GMT.
Hourly chart
Traders remain slightly bullish
Traders are slightly bullish on the pair, as 53% of open positions were long on Friday. Meanwhile, trader set up orders were bearish, as 64% of pending commands were to sell the Euro.
OANDA traders have increased their bullish outlook, as 63.00% of open EUR/USD positions are long on Friday, compared to 60.94% short positions on Thursday. Meanwhile, SAXO Bank clients have become almost perfectly neutral, as 50.60% open positions are long now, compared to 53.32% short positions during the previous trading session.