- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot dropped considerably from yesterday (44% bullish / 56% bearish)
- The closest resistance for this pair is located at 1.1294
- At the same time, the closest support is currently placed at 1.1219
- Upcoming events on May 14: US Unemployment Claims (May 8)
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Greece paid around 750 million euros to the International Monetary Fund on Monday, a day before the deadline, alleviating the prospect of default. As Athens is close to running out of cash, there had been doubts about whether it would prefer paying the IMF or choose to save cash to pay salaries and pensions later this month. Greece took 650 million euros out of an IMF holding account used for emergencies to make the repayment. The account has to be refilled within a few weeks.
Following the payment, Greece's financial condition remains insecure unless it ensures fresh aid from lenders. Nevertheless, it is expected that the IMF will not join a potential third Greek bailout package. Lack of "really effective action" and the recent Athens' decision to re-hire public employees, who were laid off under austerity measures have shaped to the IMF's decision.
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US jobless claims to worsen slightly for week ended May 8
Tomorrow, Germany and France and celebrating the Ascension Day; therefore, no fundamentals are expected from these two countries. As a result, after a busy day on Wednesday with many market movers, there will be only a few news releases tomorrow. The most closely watched event will be a release of US unemployment claims that are out at 12:30 PM. They are estimated to grow moderately up to 272,000 for the week ended May 8.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 1.1450 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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From the first attempt, the single European currency failed to penetrate an important resistance area above 1.12. Represented by 100-day SMA and weekly PP, these technical levels tried to decrease the bullish pressure. However, on Wednesday morning the pair inched higher above them. In case EUR/USD remains upbeat, bulls will then pay attention to recent highs at 1.1390, which are accompanied by the weekly R1.
Hourly chart
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EUR/USD sentiment stays bearish, while pending orders return below 50%
Starting from the beginning of last week, pending orders on the EUR/USD currency pair were increasingly volatile every day. Yesterday, the commands to buy the Euro currency against the US Dollar in 100-pip range from the spot price have plummeted by 21% and reached just 44% this morning. It proclaims that in case the EUR/USD rises in value, the pair's potential rebound is likely to be capped by a resistance at 1.1390 (May high). On the other hand, a downward development of the Euro can be extended down to 1.1065 (May 5 low).
Spreads (avg,pip) / Trading volume / Volatility
Community is waiting for the Euro to remain mostly unchanged this week
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Read More: Community Forecasts
Jignesh, one of the community members participating in the survey, motivates his bullish outlook towards the common currency by saying that "EUR/USD has recently taken out some major resistance at 1.1050 and 1.11 level. The pair should be supported to the downside and is poised for an upside move. Weekly & Monthly candlesticks indicate a continued bullish move, while dailies suggest a pullback early in the week."
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Apr 13 and May 13 expect, on average, to see the currency pair slightly below 1.10 by the end of August. Though the majority of participants, namely 54% of them, believe the exchange rate will trade below this level in ninety days, with 40% alone seeing it below 1.06. Alongside, 25% of those surveyed reckon the price will trade in the range between 1.10 and 1.16 by the end of August of this year.
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