- SWFX market sentiment is 61% bearish
- 55% of pending orders in 100-pip range are set to BUY
- Significant resistance is located near 1.21
- Upcoming Events: ISM Manufacturing PMI and FOMC Meeting Minutes
The surge of the EUR/USD currency pair has finally stopped on Wednesday. However, some clues indicate that the stop is only temporary, as some technical aspects indicate of a continuation of the surge of the Euro.
Factory activity in Chicago strengthened again by the end of the year, according to the MNI survey. Market News International stated that its PMI of manufacturing sector in Chicago jumped to 67.6 in December, after 63.9 reading in the previous month. The survey also showed that businesses were shoring the stock level to support lead times and prepare for next year's product launches. However, the employment rate decreased, but remained higher than in post-crisis times.
Minor release and the Fed
The fundamental events of the week start becoming notable this week on Wednesday. First of all at 15:00 GMT the ISM Manufacturing PMI will be published. Secondly, but more importantly the FOMC Meeting Minutes will be made public at 19:00 GMT.
EUR/USD pauses its surge
The common European currency has stopped its surge against the US Dollar. The event is providing an opportunity to review the situation on the charts.First of all the currency pair has passed the support of the lower trend line of a junior channel up pattern near the 1.2050 mark. Due to that reason it can be expected that a new junior pattern should be looked for, as the rate continues to fluctuate.
Secondly, the pair has revealed the upper trend line of a medium scale pattern, which has guided the pair for a few months.
In regards to the near future, the 1.21 mark is still the target.
Hourly Chart
The previous forecast on the daily chart remains in force - By watching the daily chart one can notice that this surge is bound to reach not only the 1.21 mark, but even the 1.2140 level. The reason for that is the fact that at that level is located the resistance of a long term channel up pattern.
However, the previously speculated period of consolidation has started earlier than it was previously expected. Instead of occurring after reaching the previously mentioned target, the pair began its decline after reaching the 1.2080 mark.
Daily Chart
Market sentiment is bearish
In result of the previous trading session the bearish market sentiment has increaased, as 60% of open positions are short.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 64% bearish and the Dollar is 56% bullish.
Traders of OANDA remain bearish, as 67% of open positions are short. SAXO Bank clients are likewise bearish on the pair with 64% short positions.
Spreads (avg, pip) / Trading volume / Volatility