- SWFX market sentiment is 56% short
- Pending orders in the 100-pip range are set to sell in 53% of cases
- No fundamental data releases until Wednesday
The decline of the EUR/USD lasted until it touched the 1.1270 level. Afterwards a recovery began which had reached the 1.1320 level on Monday. Meanwhile, note that this week prior to the holidays is expected to be quiet.
The European Single Currency depreciated against the US Dollar, following the EU Main Refinancing Rate release on Thursday at 12:45 GMT. The EUR/USD exchange currency rate lost 19 pips or 0.17% during a minute, right after the release. The European Single Currency continue trading at the 1.1380 area against the US Dollar.
The European Central Bank released the EU Main Refinancing Rate data in line with expectations of 0.00%.
According to Howard Archer, Chief Economic Advisor to EY ITEM Club, "ECB slightly trims its forecast of Eurozone GDP growth in 2019 to 1.7% from 1.8% seen in September. 2018 growth estimate cut to 1.9% from 2.0%. Growth still seen at 1.7% in 2020. 2021 growth forecast at 1.5%. Balance of growth risks broadly balanced but moving to downside."
Quiet week for macroeconomic data releases
Until Wednesday there are no notable data releases scheduled to occur that might impact any of the major pairs or gold.On Wednesday, the macroeconomic data releases will start at 09:30 GMT with the UK Consumer Price Index. The event is expected to cause at least a 20 base point move.
On the same day at 13:30 GMT the Canadian will publish the Consumer Price Index data sets. During the last half a year the data release has caused fluctuations of at least 40 pips.
Afterwards at 19:00 GMT the event of the week will take place. Namely, the FOMC Statement and the Federal Funds Rate will be published. The Federal Reserve is expected to hike the US central banks interest rate to 2.5% from 2.25%.
In theory the event is expected to cause a US Dollar surge, which would beat the top pairs downwards. This year the interest rate hikes have caused moves of at least 40 base points.
On Thursday, all attention will be paid to events in the UK. Namely, at 09:30 GMT the UK Retail Sales are expected to cause a move from 10 to 40 pips.
Afterwards, the Bank of England will announce their rate decision. The event has caused moves from 26 to 97 pips since May 2018.
On Friday the data releases will continue. During the morning hours, namely, at 09:30 GMT the UK Current Account will be published. This event causes moves from 15 to 45 pips.
The week's data will end at 13:30 GMT. At that time the Canadian Retail Sales and GDP data will be published. Simultaneously the US Durable Goods data sets and Final GDP will be released.
The last event is too complex to explain it shortly. Instead, state your questions at the weekly Monday's economic calendar stream at 12:00 GMT.
The above mentioned data release will be covered by Dukascopy Analytics. The event can be watched on our YouTube channel.
EUR/USD daily review
During Friday's trading session, the European Single Currency passed through the monthly pivot point at the 1.1346 mark to depreciate by 56 pips or 0.49%. On Monday morning, the rate was recovering itself to trade upwards at the 1.1308 mark.Most likely, the European Single Currency will be trading near the bottom boundary of the dominant pattern at the 1.2600 level. The 55-hour simple moving average will try to catch up the rate to give an additional resistance for the currency pair.
On the other side, the European Single Currency could recover itself to appreciate against the US Dollar to trade near the weekly PP at the 1.1340 mark.
Hourly Chart
The daily chart shows the rate at crossroads. It has already pierced the lower trend line of a large scale almost horizontal pattern.
Meanwhile, note that a possible surge of the currency exchange rate was stopped by the resistance of the 55-day simple moving average, which on Monday was located at the 1.1410 level.
Daily chart
On Friday, 53% of trader open positions on the Swiss Foreign Exchange were shorting the EUR/USD. By the middle of Monday's trading session 56% of traders were already shorting the pair.
Meanwhile, trader pending orders in the 100-pip range on Monday were set to sell in 57% of cases.
In general, traders were shorting the pair and prepared to do additional selling of the EUR/USD.