- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot are bearish (40% long / 60% short)
- The closest resistance for this pair is located at 1.1141
- At the same time, the nearest support is currently placed at 1.1058
- Upcoming events in the next 72 hours: Euro zone Services PMI (Jun) and Retail Sales (May), Germany Factory Orders (May), Greece Referendum
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The number of registered unemployed in Spain continued to decline in June, falling by 94,700 after a considerable decline of almost 118,000 in May. The Bank of Spain has upgraded its 2015 growth forecast, referring to domestic demand as the key driver for economic growth. The Spanish economy is expected to grow 3.1% this year, above the initially estimated 2.8%. However, the central bank's estimate of 2.7% for 2016 remains intact.
In the meantime, an International Monetary Fund analysis revealed that Greece needs at least another 36 billion euros over the course of next three years from Euro zone member states as well as easier terms on existing debt to keep the country afloat. The IMF also said that without some reduction in Greece's staggering debt load, the country has little hope of an economic recovery.
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Greek referendum to take place Sunday
The referendum on whether to accept the proposals from international creditors will take place in Greece this Sunday, while the latest opinion polls show that the Greeks are undecided at the moment. Meanwhile, several Euro zone countries will release the PMI indicators for the services industries today, including Germany, France, Italy and Spain. Markets expect all of them to remain above 50 points, while the data are due from 7:15 AM GMT to 8:00 AM GMT, depending on the country.Read More: Fundamental Analysis
EUR/USD likely to lose value, trading range to narrow down
Judging from EUR/USD's developments that took place since May of the previous year, the pair is clearly trading downwards on a long-term chart. At the same time, it seems that now the pair is being bounded between the 2014 low and long-term downtrend line, meaning that it is currently hovering inside the descending triangle pattern. Moreover, this pattern implies a narrowing trading range, while the break-out point can be reached by the end of September. In the medium-term the common European currency may show spikes as high as 200-day SMA and 2005 low at 1.16, but the downtrend will remain the main resistance and should be capable of pushing the cross back in the direction of 1.05-1.10 area in the long run.Daily chart
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EUR/USD was somewhat upbeat after the NFP numbers yesterday, as the currency pair seems to have started eroding a loss of 190 pips that occurred Tuesday-Wednesday. Moreover, the Euro is presently underpinned by the 100-day SMA and weekly S1 at 1.1050. The short-term outlook is neutral to positive, while the pair is able to rally towards the 55-day SMA at 1.1141. However, the medium-term expectations remain pessimistic and bears are still setting eyes on Jun 29 low at 1.0954.
Hourly chart
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Read More: Technical Analysis
EUR/USD sentiment slightly below 50%, pending orders remain bearish
Meanwhile, the portion of pending orders to buy the Euro against the US Dollar in 100-pip range from the spot price fell back to the level observed six days ago, thus decreasing from 44% to 40%.
It proclaims that in case the EUR/USD rises in value, the pair's near-term gains can be capped by the 55-day SMA, currently at 1.1135. On the other hand, a downward development of the Euro is likely to be extended down to the Jun 29 low / weekly S2 at 1.0954.
Spreads (avg,pip) / Trading volume / Volatility
Community suggests the Euro will decline against the US Dollar this week
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Read More: Community Forecasts
geula4x, one of the community members participating in the survey, motivates his bearish outlook towards the single currency by saying that "EUR/USD opened this week with a big gap down. Greece has not reached an agreement with creditors, plus there is a referendum scheduled for next Sunday. All this suggests that Greece may leave the Euro Zone. Therefore, bears seem better positioned to take control this week. Resistance lies around 1.1220, Friday's daily high. Support lies around 1.0850, which has held price between May 26 and 28."
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Jun 3 and Jul 3 expect, on average, to see the currency pair around 1.12 by the end of October. Though the majority of participants, namely 52% of them, believe the exchange rate will trade below this level in ninety days, with 33% alone seeing it below 1.08. Alongside, only 20% of those surveyed reckon the price will trade in the range between 1.12 and 1.18 by the end of October of this year.
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