- SWFX market sentiment is 62% bullish (+2%)
- 54% of pending orders in 100-pip range are to SELL the Euro
- Upcoming fundamental events: German ZEW Economic Sentiment, US CPI and Core CPI
The Euro has fallen in a range between the 55-, 100- and 200-hour SMAs.
The Markit released Manufacturing Purchasing Managers Index data that came out better-than-expected of 54.4, compared to the 53.9 in the previous period.
"At first glance, the mild acceleration in the rate of output growth and rise in the headline PMI would appear positive," Rob Dobson, a Markit director, said. "However, scratch beneath the surface and the rebound in the PMI from April's 17-month low is far from convincing."
US CPI in focus
The first data release of importance on Tuesday is the German ZEW Economic Sentiment published at 0900GMT. The US Bureau of Labour Statistics is to publish the Consumer Price Index and its core reading at 1230GMT. Analysts expect a 0.2% and 0.1% increase month-on-month, respectively.
Meanwhile, some noise today could be caused by political developments in the Singapore Summit which has brought together the US President Donald Trump and the North Korean leader Kim Jong-un.
EUR/USD flashes bearish signals
No significant changes were introduced to EUR/USD's positioning on Monday, as it remained trading along the 55-hour SMA. The pair, however, provided the second confirmation of a three-day channel down (dashed lines). The bearish momentum took the upper hand early today, thus pushing the rate past the prevailing two-week channel up and below the 55– and 100-hour SMAs.The pair is currently stranded between these lines and the 200-hour SMA. The same moving averages constrain the rate on the four-hour chart, as well. Thus, it is likely that large gains are limited today.
It is expected that the Euro remains tended south, setting the lower channel boundary and the 55– and 100-period (4H) SMAs near 1.17 as the daily low. In the meantime, gains should not exceed 1.19.
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. The pair started to recover on May 30 after hitting a six-month low of 1.1550. It is expected that this up-move continues in the medium term.
The Euro breached the monthly PP and the 23.60% Fibonacci retracement near 1.1765. The 1.18 mark should eventually surrender, thus allowing the pair to appreciate until the 55- and 200-day SMAs and the monthly R1 near 1.20.
Daily Chart
Bulls remain in charge
EUR/USD remains strongly bullish with 62% of open positions being long (+2%).
The outlook for the two currencies against the rest of the traded financial instruments is as follows: the Euro is 57% bullish and the US Dollar is 62% bearish.
OANDA traders have weakened their bullish sentiment to 52% of open positions being long today (-6%). Meanwhile, the market sentiment of Saxo bank is 51% bearish (-1%).
Spreads (avg, pip) / Trading volume / Volatility