- SWFX market sentiment is 52% short
- Pending orders in the 100-pip range are set to sell in 59% of cases
- Federal Reserve rate hike expected to occur at 19:00 GMT
The rate has reached the previously set target of 1.1410. From a technical perspective the rate is set to reach the 50.00% Fibonacci retracement level at the 1.1460 level, as the resistance of the weekly R1 at the 1.1410 mark was getting pierced by the middle of Wednesday's trading session.
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."
The FOMC rate announcement is incoming at 19:00 GMT
On Wednesday, 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 the previous trading session, the European Single Currency was supported by the 200-hour SMA to surge towards the weekly R1 at the 1.1410 mark. On Wednesday morning, the rate was trading near the weekly R1 at the 1.1403 mark.Most likely, the currency exchange rate will get resisted by the weekly R1 at 1.1403 to push the rate to trade sideways to stay at the 1.1380 level.
On the other side, the currency exchange rate could break the resistance of the weekly R1 to move towards the 50.00% Fibonacci retracement level at the 1.1462 mark.
Hourly Chart
On the daily chart note the additional resistance levels.
The 55-day simple moving average is located at the 1.1410 level, strengthening the resistance of the weekly R1.
Meanwhile, the 100-day simple moving average is set to support the monthly R1 at the 1.1480 level.
Daily chart
Previously, traders were 58% short. On Wednesday, only 52% of trader open positions on the Swiss Foreign Exchange were short.
Meanwhile, trader pending orders in the 100-pip range were set to sell in 57% of cases.