- Commands to buy the Euro versus the US Dollar in 100-pip range are negative (38% bullish / 62% bearish)
- The closest resistance for this pair is located at 1.0930
- At the same time, the closest support is currently placed at 1.0811
- Upcoming events on April 29: ECB Economic Bulletin, US GDP (Q1) and Pending Home Sales (Mar), FOMC Statement and Federal Funds Rate
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The European Central Bank is unlikely to stop its bond-buying programme earlier than planned, according to economists' expectations. Some believed that the ECB will carry on with its QE scheme till September 2016 and then stop it abruptly without tapering purchases. Others said policy makers would steadily wind the programme down, with the end-date ranging from December 2016 to December 2017.
To underpin inflation, the ECB plans to expand its balance sheet to about 3.1 trillion euros from 2.3 trillion euros currently, by buying government bonds, agency debt and private securities. Economists saw that level will be surpassed in 2016 and reach 3.4 trillion euros by the end of that year.
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US GDP numbers to be in focus on Wednesday
On Wednesday of this week, markets will be waiting for one of the most important statistical releases of all, as the United States are releasing their economic growth numbers for January-March quarter. Analysts expect a slowdown to just 1% annual GDP growth, down from 2.2% in the last quarter of 2014. The world's biggest economy has probably been negatively influenced by strong Greenback, as well as unfavourable weather conditions during the winter.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 1.13 mark where 100-day SMA and 23.6% Fibonacci retracement will most probably push the cross back in the direction of 1-1.05 area. In the meantime, the Euro may hit 1:1 against the US Dollar as soon as September-October. However, a presence of dense zone of technical levels may also considerably influence the time-frame for this important event.Daily chart
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EUR/USD rallied for a third consecutive day on Monday as the single European currency is targeting the 55-day SMA, currently at 1.0930. However, a move significantly beyond this mark is unlikely. Additional resistances are located at 1.1040 and 1.1098, represented by March/April highs and January low, respectively. Therefore, the outlook for the Euro's short-term development remains bearish, unless the pair consolidates above 1.11 (monthly R1) in the foreseeable future.
Hourly chart
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Read More: Technical Analysis
EUR/USD sentiment and pending orders remain negative
Pending orders to buy the Euro against the US Dollar in 100-pip range from the spot slumped further to 38%, down six percentage points on a daily basis. It proclaims that in case the EUR/USD rises in value, the pair's potential rebound can be limited by the 55-day SMA at 1.0938. On the other hand, a downward development of the Euro is assumed to be extended down to weekly S1 at 1.0720 in the medium-term.
Spreads (avg,pip) / Trading volume / Volatility
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Mar 28 and Apr 28 expect, on average, to see the currency pair at 1.07 by the end of July. Though the majority of participants, namely 52% of them, believe the exchange rate will drop even below 1.06 in ninety days, with 26% alone seeing it below 1.02. Alongside, 24% of those surveyed reckon the price will trade in the range between 1.06 and 1.12 by the end of July of this year.
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