- SWFX market sentiment is 63% bullish (-1%)
- 66% of pending orders in 100-pip range are to SELL the Euro
- Upcoming fundamental events: CPI Flash Estimate y/y, Core CPI Flash Estimate y/y, US Core PCE Price Index m/m, US Unemployment Claims, Chicago PMI, FOMC Members Bostic and Brainard to speak
A strong surge early on Thursday resulted in a breakout of the 200-hour SMA and a channel line.
The Greenback strengthened against the Eurozones's single currency, following the US Preliminary GDP data release on Wednesday. The EUR/USD currency pair lost six pips, or 0.05%, however retraced back in the next minute and afterwards continued to fluctuate in the 1.1625 area.
The Bureau of Economic Analysis released Preliminary Gross Domestic Product data that came out lower-than-expected of 2.2%, compared to the 2.5% in the previous period.
"The revision to headline GDP growth was small, as were most of the revisions to GDP components. The standouts were weaker inventory investment, weaker residential investment and stronger business investment," said Chris Low of FTN Financial Group.
No major fundamentals today
The economic calendar for this session includes several fundamental releases of medium importance. Eurostat is set to publish the CPI Flash Estimate and its core reading for the Euro zone at 0900GMT.
Meanwhile, the United States will release the Core PCE Price Index and the weekly Unemployment Claims at 1230GMT. The Chicago PMI is published at 1345GMT.
The President of the Federal Reserve Bank of Atlanta Raphael Bostic is due to speak at 1645GMT, while the Fed Governor Lael Brainard – at 1700GMT.
EUR/USD strengthened by fundamentals
By Thursday morning, the pair had steadily approached the 200-hour SMA and the upper boundary of a seven-week channel circa 1.17. Given that this resistance area is likewise strengthened by the 55-period SMA on the 4H chart, the Euro might be reluctant to overcome this level on the first occasion. This mark, however, should eventually surrender and send the pair towards the 1.1950 territory.
In case no fundamentals shake the market today, a fall below the 55-hour SMA and the weekly S1 at 1.1590 is not expected.
Hourly Chart
The common European currency has fallen considerably against the US Dollar since mid-April which marks a 5.95% plunge within a couple of weeks.
As apparent on the daily chart, this bearish momentum has allayed during the past two weeks, thus pointing to a soon change in direction. Technical indicators are likewise starting to stabilise in the oversold territory.
The nearest support is provided by the monthly S3 at 1.16. This level should not be breached.
Daily Chart
Bulls remain in charge
EUR/USD remains strongly bullish with 63% of open positions being long (-1%).
The outlook for the two currencies against the rest of the traded financial instruments is as follows: the Euro is 58% bullish and the US Dollar is 61% bearish.
OANDA traders are bullish on the Euro with 58% of open positions being long today (+1%). The market sentiment of Saxo bank has changed to bearish, as its clients are holding 51% short positions.
Spreads (avg, pip) / Trading volume / Volatility