- SWFX market sentiment is 58% bullish
- Trader pending orders are 65% to sell
- Pair opened Tuesday's session at the 1.0736 level
- Aggregate daily technical indicators bet EUR/USD will remain unchanged
- Economic events to watch over the next 24 hours: EU Flash GDP; German ZEW Economic Sentiment; US Retail Sales; US Empire State Manufacturing Index; US Import Prices; FOMC Member Fischer Speaks
Mood of Americans shoppers improved more than expected in November, after falling to its lowest level since 2014 in the previous month, a flash survey showed on Friday. The Consumer Sentiment Index produced by the University of Michigan came in at 91.6, up from October's final reading of 87.2, while market analysts anticipated s slight acceleration to 87.4 points. The survey was conducted before the results of the US presidential elections were announced. Furthermore, the Index was 0.3% higher than at the same time last year, and surpassed the current year's average of 91.1 points. Meanwhile, the sub-gauge of current economic conditions advanced 2.6% to 105.9, and the sub-gauge of future expectations increased 7.4% to 82.5 from the prior month's 76.8 points. Consumer sentiment managed to improve in November, even though long-term and short-term inflation expectations climbed to 2.7%, after touching a record low of 2.4% in October. Richard Curtin, chief economist of the survey, said that it may be a one-month phenomenon. Nevertheless, he added that the November data may be enough to justify a December rate hike. The EUR/USD pair fell immediately to 1.0872 from 1.0873 ahead of the release.
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.
Upcoming fundamentals: Various data with US retail sales at the top
Fundamental data, which will affect the EUR/USD currency exchange rate is set to be released from both sides of the Atlantic on Tuesday. First of all data from the EU will be out at 10:00 GMT, as the EU Flash GDP and German ZEW Economic Sentiment index are set to be released at that time. In the second half of the day data from the US will begin pouring in, and that will subsequently dictate the strength of the US Dollar for the day. US Retail Sales and Core Retail Sales will be published at 13:30 GMT. In addition, at the same time the Empire State Manufacturing Index and the US Import Price data will be out. Moreover, by the end of the day, at 18:30 GMT, FOMC member Fischer is set to give a speech, giving clues on US monetary policy.
EUR/USD pauses on Tuesday morning
Daily chart: The common European currency scored about fifteen pips against the US Dollar on early Tuesday morning, which could almost be called as remaining flat. Previously, on Monday the currency exchange rate fell from 1.0833 to end the day at 1.0737. During the move the pair passed the support cluster made up of the March low of 1.0822, the long term pattern's lower trend line at 1.0830 and the first monthly support level at 1.0806. It is most likely that the exchange rate will remain flat by the end of the day.Daily chart
Hourly chart: The hourly chart for the EUR/USD pair reveals that the currency exchange rate has formed a descending channel pattern in the aftermath of the US election. Moreover, it can be seen that, as forecasted, the pair did reach the January low at 1.0709. There the Euro rebounded against the US Dollar and has scored minor gains since then. However, in general the rate is set to move lower.
Hourly chart
Traders remain bullish
SWFX traders remain bullish on the pair, as 58% of open positions were long on Tuesday morning. Meanwhile, 65% of trader set up orders are to sell the Euro.
OANDA traders have almost not changed their outlook, as 62.11% of open EUR/USD positions are long on Tuesday, compared to 63.38% long positions on Monday. Meanwhile, SAXO Bank clients remain slightly bullish, as 51.49% open positions are long now, compared to 53.19% long positions during the previous trading session.