Germany factory orders rose markedly in the last month of 2016, driven by a sharp increase in demand for investment goods, official figures revealed on Monday. According to the Economy Ministry, German industrial orders advanced at seasonally adjusted rate of 5.2% in December, following the preceding month's downwardly revised fall of 3.6% and surpassing market analysts' expectations for an increase of 0.6%. The December pace was the strongest since July 2014. On an annual basis, factory orders grew 8.1% in December. Monday's data provided evidence that economic growth accelerated in the final quarter of 2016 after climbing just 0.2% in the Q3 of 2016.
The Q4 2017 GDP data is scheduled to be released on February 2014. The majority of analysts suggest the economy expanded at a 0.5% pace during the Q4. However, their long-term forecasts are less optimistic in large due to the upcoming German federal elections. Yesterday's data also showed export orders climbed 10% month-over-month in December, driven by a 19.5% increase in demand for capital goods from the Euro zone. Meanwhile, domestic orders advanced 6.7% during the same period. On a quarterly basis, factory orders grew 4.3% in the Q4. After the release, the Euro extended its losses, falling to 1.0746 against the US Dollar.
Upcoming events: Minor US data
Two medium ranked data releases are set to be released during today's trading session. At 13:30 GMT US Trade Balance will be released and covered by the Dukascopy research team. In addition, at 15:00 GMT JOLTS Job Openings will be published.
EUR/USD below 1.07 mark
Daily Chart: During the early hours of Tuesday's trading session the common European currency fell below the 1.07 mark against the US Dollar, and there were no signs of the fall stopping. The currency exchange rate passed the 20-day SMA at 1.0695, which was the last support level before the 1.0659 level, where the weekly S1 is located at. Due to these factors combined it can be assumed that the pair will fall as low as the just mentioned support level by the end of Tuesday's trading. However, it is most likely that that support level will also stop the decline of the Euro.Bearish sentiment persists
SWFX traders remain bearish regarding the pair, as 52% of trader open positions are short. In the meantime, 57% of trader set up orders are to sell the Euro.
Spreads (avg,pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.06 in May
Traders, who were questioned on their longer-term views on EUR/USD between January 7 and February 7 expect, on average, the currency pair to trade around 1.06 by the start of May. In general, 51% of participants believe the exchange rate will be generally below 1.06 in ninety days, and 24% see it below 1.02. In the meantime, 20% of those surveyed reckon the pair will trade above 1.12 in three months.