- SWFX market sentiment is 59% bearish
- Trader pending orders are 58% to sell
- Pair opened Monday's session at the 1.1229 level
- Aggregate daily technical indicators bet EUR/USD will surge
- Economic events to watch over the next 24 hours: Spanish Manufacturing PMI; Italian Manufacturing PMI; French Manufacturing PMI; German Manufacturing PMI; EU Final Manufacturing PMI; US Final Manufacturing PMI; US ISM Manufacturing PMI; US Construction Spending; ISM Manufacturing Prices
Consumer prices in the Euro zone increased last month, official data showed on Friday. According to Eurostat's preliminary reading, the annual Consumer Price Index in the region advanced 0.4% in September, following to the preceding month's 0.2% and meeting analysts' expectations. Meanwhile, the so-called core CPI, which excludes food, energy, alcohol and tobacco, rose 0.8% in the reported month, unchanged from the previous month's reading, whereas economic desks anticipated a slight acceleration to 0.9%. Prices of food, alcohol and tobacco jumped 0.7% in the ninth month of the year, following August's rise of 1.3%, while prices of services and 1.2%, slightly up from the previous month's 1.1%. Non-energy industrial goods prices accelerated 0.3%, unchanged from August, whereas the price of energy declined 3.0% in September, following the prior month's 5.6% fall. The Euro zone seasonally adjusted unemployment rate was 10.1% in August, in line with July's reading but down from 10.7% seen in the same month year ago. Other data released by Federal Statistics Office showed that Germany's retail sales increased 3.7% on an annual basis and dropped 0.4% in August. The July figure was revised down to a gain of 0.5% from the originally reported rise of 1.7%.
The number of Americans filing for unemployment benefits rose less than expected, official figures revealed on Thursday. According to the US Department of Labor, the number of claimants jumped 3,000 to a seasonally adjusted rate of 254,000 in the week ended September 24 after touching the lowest level since mid-July in the previous seven days. Meanwhile, market analysts anticipated an increase to 260,000 claims in the week ending September 24, following the preceding week's 251,000. Filings for US unemployment benefits remained below the 300,000 level for the 82nd consecutive week, the longest streak since 1973. The four week moving average of initial claims, considered a better measure of labor market trends, declined 2,250 to 256,000 last week. Furthermore, so-called continuing claims dropped 46,000 to 2.062 million in the week ended September 17. According to the final Q2 GDP print released by the Department of Commerce the US economy expanded at an inflation-adjusted 1.4% seasonally adjusted annual rate in the Q2 after growing 0.8% in the Q1. Economists expected the Q2 GDP to increase 1.3%. The US Dollar Index advanced to 95.49 from 95.42 ahead of the release.
Upcoming fundamentals: Manufacturing PMIs
As it is the first working weekday of a new month, manufacturing PMI data will be released on both sides of the Atlantic. First of all the EU countries will publish their survey results, starting at 7:15 GMT with the Spanish Manufacturing PMI. Afterwards, the rest of the notable countries will continue in a following order – Italian's at 7:45 GMT, French at 7:50 GMT and the Germans at 7:55 GMT. As, the data will be released, EU statistics officials will compile a Final Manufacturing PMI index at 8:00 GMT. The strength of the US Dollar will be directed by manufacturing data releases later in the day, as the Final Manufacturing PMI will be out at 13:45 GMT. However, there will be additional data regarding the US, as ISM Manufacturing PMI, Construction Spending and ISM Manufacturing Prices will be released at 14:00 GMT.
EUR/USD experiences high volatility
Daily chart: The common European currency is traded against the US Dollar above the newly formed weekly and monthly pivot points, which are respectively at 1.1224 and 1.1230. Previously, on Friday the currency exchange rate experienced very high volatility of an almost 100 pips range, as the pair bounced between 1.1250 and 1.1153 levels. Although, the Euro is still set to surge against the Greenback, in the recent trading sessions the 1.1250 level has showed a lot of resistance, as it has even made the rate change its direction on its own, without the assistance of other resistance levels.Daily chart
Hourly chart: The hourly chart for the EUR/USD pair shows a magnificent picture of a sudden fall and an even greater rebound. The rate traded almost flat until 5:00 GMT on Friday, when the currency exchange rate began to fall and it reached the 1.1153 level around 12:00 GMT. Afterwards, the pair skyrocketed, as it surged to 1.1250 in the next three consecutive hours. However, since then the currency pair has been rather flat, as it has fallen to the newly formed monthly pivot point at 1.1230.
Hourly chart
Trader remain bearish
SWFX trades have slightly changed their thoughts after six consecutive sessions of stagnated bearishness, as on Monday 59% of open positions were short, compared to the previous 60%. In the meantime, pending orders are 58% to sell the pair.
OANDA bearish trader sentiment increased on Monday, as 60.92% of open positions are short. In the meantime, SAXO Bank clients have increased their bearish stance, as open short positions now add up to 68.34% compared to 66.73% during the previous trading session.