EUR/USD more predictable than ever

Source: Dukascopy Bank SA
  • SWFX market sentiment is 57% bearish
  • 51.89% of pending orders in 100-pip range are set to SELL
  • Pair opened Wednesday's session at 1.1735
  • Upcoming Events: US Building Permits; FOMC Meeting Minutes

The EUR/USD pair has reached another target, as it has bounced off the support line of the medium term ascending channel pattern. The forecasting of the pair's movements has been becoming increasingly easier during this week. In accordance with the technical patterns a short term surge is about to occur on Wednesday. However, the FOMC Meeting Minutes are set to be released during today's trading session, which might change the situation.

The EUR/USD currency pair dropped sharply owing to the strong US economic release. The Greenback strengthened against the Euro by 0.23% to reach the 1.1713 mark. However, by the end of the Tuesday's session the European single currency recovered to pre-data levels. 

The Commerce Department revealed that retail sales in the United States recorder the biggest increase in the last seven months, surging 0.6% month-over-month in July and following an upwardly revised gain of 0.3% in the prior month. July's upbeat figures suggested that the economy kept gaining momentum in the Q3 amid higher confidence in the country's economic outlook. Meanwhile, the Federal Reserve became less likely to delay the next interest rate increase until 2018.

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US Building Permits and the Federal Reserve



Main focus on Wednesday will be on the release of the FOMC Meeting Minutes. However, until then the markets might experience some volatility from the US Dollar's side due to another fundamental data release. At 12:30 GMT the US Building Permits data will be published. The data release is set to be covered on the live webinar platform by the Dukascopy Research team.



EUR/USD bounces off dominant support

The EUR/USD currency exchange remains predictable, as another target was reached during Tuesday's trading session. As it can be observed on the chart, the Euro reached the support line of the medium term descending channel pattern against the US Dollar. 

On Wednesday various events can be expected. First of all, a new short term ascending pattern should be spotted. Secondly, as the pair has reached above the resistance of the weekly S1, the rate will set out to test the resistance of the various hourly SMAs, which are located near the 1.1770 mark. However, it is most likely that the resistance of the simple moving averages will be passed.

Hourly Chart


By looking at the daily chart, a piece of new notable information can be acquired. It can be observed that the 20-day SMA is providing resistance to the currency exchange rate at the 1.1750 mark. Due to that reason, before reaching for the hourly resistance levels, this needs to be passed.

Daily Chart




Markets are bearish on the pair

The SWFX trader open positions are 57% short. On Wednesday 54.67% of pending commands are to buy, compared to 52.49% of buy orders previously.

Traders of OANDA remain largely bearish, as 67.29% of open positions are short. Meanwhile, SAXO bank clients are also not changing their opinion, as 59.63% of traders are short, compared to 58.75% previously.


Spreads (avg, pip) / Trading volume / Volatility

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