- SWFX market sentiment is 54% bearish
- 54% of pending orders in 100-pip range are set to SELL
- 53% of traders are bullish on the Dollar
- Upcoming Events: Euro Zone Final CPI
As the House and Senate managed to reach agreement on tax reform, the Dollar strengthened against the Euro. Today the Euro is expected to try to restore some posotions, even though they are likely to be blocked by various technical indicators located near 1.1780.
The US Dollar touched its weakest point against the Euro, following the stronger-than-expected retail sales report. The EUR/USD exchange rate rose 23 base points to the 1.1855 area, but reversed an upward trend to be seen trading below the 1.1800 mark.
The US retail sales expended more than anticipated in November, amid the brisk start of holiday season, suggesting that sustained economic strength could set the stage for further Fed's rate hikes in 2018. The Commerce Department stated that the country's retail sales increased 0.8% in November, following an upwardly revised 0.5% gain in the prior month, as households bought range of goods, while cutting motor purchases.
Quiet Monday
Except for release of final data on inflation in Euro Zone, there are no other notable macroeconomic events scheduled for today.
EUR/USD plunges amid tax reform progress
Due to bearish pressure exercised by the 55-, 100- and 200-hour SMAs the currency exchange rate ended previous trading session below the 38.2% Fibonacci retracement level at 1.1760. In result of this movement, the pair broke through the bottom boundaries of two junior ascending channels. Despite the minor recovery of Euro the downward movement is expected to continue, being mainly driven by optimism surrounding tax reform. From technical perspective, the surge of the Euro should be neutralized by a combination of the above moving averages together with the updated weekly PP at 1.1777. In case these barriers are broken, the rate would still have another resistance line set up by the monthly PP at 1.1807. The opposite side, in contrast, is does not contain any notably obstacles up until support zone located between the 1.1730 and 1.1722 levels.
Hourly Chart
In result of the previous trading session, the pair ended up at the 38.2% Fibonacci retracement level located at 1.1760. In larger perspective, the bearish movement is expected to continue. The first reason is that the pair is trading in a senior descending channel. The second reason is that it has simultaneously formed the head and shoulders pattern, which also presupposes further decline.
Daily Chart
Market sentiment is bearish
In result of the previous trading session the bearish market sentiment has not change, as 54% 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 59% bearish and the Dollar is 53% bullish.
Traders of OANDA remain bearish, as 54% (-1%) of open positions are short. Meanwhile, SAXO are bearish on this currency pair with 56% (+0%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility