- Commands to buy the Euro versus the US Dollar in 100-pip range are strongly positive (67% bullish / 33% bearish)
- The closest resistance for this pair is located at 1.1383
- At the same time, the closest support is currently placed at 1.1257
- Upcoming events on May 8: Germany Trade Balance (Mar), US Non-Farm Payrolls and Unemployment Rate (Apr)
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Euro zone retail sales came out weaker than expected in March, turning negative when measured on a monthly basis for the first time since September last year. According to Eurostat, retail sales in the 19 countries dropped 0.8% month-on-month translating into a 1.6% year-on-year increase. Economists, however, had expected a 0.7% monthly decline and a 2.4% annual rise.
Meanwhile, a separate report showed business activity in the Euro zone's services sector slowed in April, but the corresponding index remained comfortably above the threshold, which separates contraction from expansion. The final reading came in at 54.1 points in the measured month, compared with 54.2 a month ago. The preliminary survey showed a 53.7 result.
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US payrolls set to rebound after disappointing numbers last month
Tomorrow, the US Department of Labour will publish figures on the non-farm payrolls, which show a net change in employment in the country. Following extremely weak numbers of 126,000 back in March, the indicator has probably rebounded to 213,000 in April, even though some expectations remain biased to the downside. In the meantime, German trade surplus is forecasted to stay fully unchanged in March at 19.7 billion euros.Read More: Fundamental Analysis
EUR/USD likely to lose value with growing trading range
Judging from EUR/USD's developments that took place since July of the previous year, the pair is clearly trading downwards with a significant negative slope. At the same time, mid-March movements of the Euro have also confirmed a widening trading range of this currency pair, meaning it is currently hovering inside the broadening falling wedge pattern. By the end of June, the common European currency may surge up to the 1.15 mark where long-term downtrend will most probably push the cross back in the direction of 1.05-1.10 area. In the meantime, the Euro's parity against the US Dollar is not off the table in the long-term.Daily chart
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For the first time since February 26, EUR/USD went above the 1.13 mark, by eroding a considerable resistance represented by the 23.6% Fibonacci retracement of May-March downtrend move. Poor US ADP data resulted in a decline of the Buck against the Euro in the direction of weekly R1. Bulls are likely to give a try and sustain the pair's growth, while a closure above 1.1383 should pave the way towards 1.15 in the medium-term. Alongside, a short-term pullback is not off the table as well.
Hourly chart
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Read More: Technical Analysis
EUR/USD sentiment is bearish, pending orders grow further
Despite well-pronounced upward movement of the Euro, pending orders to buy this currency against the US Dollar in 100-pip range from the spot climbed by additional eight percentage points yesterday, as they reached their highest level in about five months at 67%. It proclaims that in case the EUR/USD rises in value, the pair's potential rebound can be extended up to the monthly R1 at 1.1486. On the other hand, a downward development of the Euro is assumed to be capped by the 23.6% Fibonacci retracement at 1.1257.
Spreads (avg,pip) / Trading volume / Volatility
Community is waiting for the Euro to grow against US Dollar this week
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Read More: Community Forecasts
geula4x, one of the community members participating in the survey, motivates his bullish outlook towards the common currency by saying that "EUR/USD seems very bullish on the daily chart. Price has bounced off 1.0660 support area and moved sharply higher last week. This area is double-bottom support, which held price from April 21 till April 23. Price has been moving strongly higher, suggesting that bullish momentum is intact."
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Apr 7 and May 7 expect, on average, to see the currency pair around 1.08 by the end of August. Though the majority of participants, namely 53% of them, believe the exchange rate will drop below this level in ninety days, with 32% alone seeing it below 1.04. Alongside, 26% of those surveyed reckon the price will trade in the range between 1.08 and 1.14 by the end of August of this year.
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