- SWFX market sentiment is 57% bearish
- 54% of pending orders in 100-pip range are set to BUY
- 55% of traders are bullish on the Dollar
- Upcoming Events: German ZEW Economic Sentiment, Euro Zone Final CPI, US Import Prices, Capacity Utilization Rate and Industrial Production
In result of the previous trading session, the currency rate broke through the 200-hour SMA. Due to pressure from the 55-, 100-hour SMAs as well as the weekly PP, the exchange rate is expected to continue to head to the bottom today as well.
The Greenback depreciated significantly against the Euro on the US economic reports on Friday. The EUR/USD exchange rate jumped 61 base points or 0.52% to enter the 1.1870 area close to the weekly high. Though, the pair gradually returned to pre-data levels, as the EUR/USD remained under the bearish sentiment, putting an exchange rate lower.
The Labour Department showed that the US Consumer Price Index edged 0.5% higher in September, the strongest gain since January, which put the yearly rate of consumer inflation to 2.2% in the reported period. Separate report showed a 1.6% increase in the country's retail sales, where its sustainable firmness could cause a cease of low inflation trend and confirm the Fed's stance to raise interest rates anytime soon.
German Business Sentiment
Today will be full of different macroeconomic data releases from both sides of the Atlantic. From fundamental point of view, the biggest importance will represent confirmation of the Euro Zone inflation at 1.5%. From technical perspective, the most interest release most probably will be announcement of the German Economic Sentiment (especially if it will beat experts' expectations again).
EUR/USD slips below 200-hour SMA
As it was expected, the currency pair failed to pass through the 200-hour SMA from the first attempt. However, a combined pressure of the 55- and 100-hour SMAs in conjunction with the weekly PP was too strong to allow the Euro to make any advances against the Dollar. As a result, the new trading session the rate started near the 1780 mark, facing no support barriers on its way up until the weekly S1 at 1.1735. This fact plus the 57% bearish market sentiment and an aggregate of technical indicators, which sends a clear sell signal, suggest that the currency pair is going to continue to move to the bottom, trying to reach the 100% Fibonacci retracement level at 1.1715. But there is a need to take into account an effect from release of the Euro Zone's inflation data and German business sentiment.
Hourly Chart
Daily chart clearly shows how the currency pair faced resistance represented by the monthly PP at 1.1875 and was forced to retreat. From this perspective, the Greenback is expected to continue to recover against the Euro looking to the 100% Fibonacci retracement level as a possible support target.
Daily Chart
Traders remain bearish
In result of the previous trading session the bearish market sentiment remained unchanged, as 57% of open positions are short now.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 61% bearish and the Dollar is 55% bullish.
Traders of OANDA remain bearish, as 64% (+0%) of open positions are short. Meanwhile, SAXO are also bearish on this currency pair with 60% (-0%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility