- SWFX market sentiment is 60% bearish
- Trader pending orders 51% bullish
- Pair opened Tuesday's session at 1.1366
- Upcoming Events: US Factory Orders; FOMC Meeting Minutes
The common European currency had retreated against the US Dollar, as it overextended its gains. Although, on Tuesday morning the currency exchange rate had already found support in the combined cluster of significance of the weekly and monthly pivot points just below the 1.1350 mark.
US manufacturing activity rose more than expected last month, official figures showed on Monday. The Institute for Supply Management reported its Purchasing Managers' Index for the manufacturing sector increased to 57.8 in June, up from 54.9 registered in the preceding month. That marked the strongest reading since August 2014, reflecting improvements in economic conditions both within the country and abroad.
FOMC Meeting Minutes
The economic calendar for Tuesday is empty. However, it is highly unlikely that any data event would grab the attention of the markets prior to what is scheduled for Wednesday. At 18:00 GMT the FOMC Meeting Minutes will be published. That is set to be the main focus of the day. In addition, at 14:00 GMT on Wednesday the Factory Orders will be out.
EUR/USD retreats below 1.14 mark
On Tuesday morning, the common European currency had retreated below the 1.1350 mark against the US Dollar. However, the combined support of the weekly and monthly pivot points at 1.1348 and 1.1331, respectively, proved strong enough to force the currency exchange rate for a rebound. It can be expected that the pair regains some of the lost ground before it faces a notable resistance level. Most likely the resistance will be provided by the 23.60% Fibonacci retracement level at the 1.1388 mark. The retracement level is set to be reinforced by the resistance of the 55- and 100-hour SMAs, which were located at 1.1396 on Tuesday morning. It could be clearly observed that the simple moving averages will approach the pair from the upside.
Hourly Chart
As it was speculated on Monday, the currency pair has retreated below the upper Bollinger band of the daily chart. However, ignoring the recent declines, the mentioned Bollinger Band continues to move higher, freeing up the range for a surge of the Euro against the Greenback.
Daily Chart
Bearish sentiment persists
SWFX traders remain bearish, as 60% of open positions are short. Meanwhile, 51% of trader set up orders are to buy the Euro.
Traders of OANDA have decreased their bearish position proportion, as 69.74% of open positions are short on Tuesday, compared to 72.81% previously. In addition, SAXO bank clients have done the same, as 65.31% of open positions are short, compared to 69.09% on Monday.
Spreads (avg, pip) / Trading volume / Volatility
Average forecast shows EUR/USD will trade above 1.12 by October
Traders, who were questioned on their longer-term views on EUR/USD between June 4 and July 4, expect, on average, that the currency exchange rate may trade above 1.12 during the first week of October. In general, 66% of participants believe the exchange rate will be above 1.12 in the following ninety days. Meanwhile, 30% of respondents expect to see the rate below 1.10.