- Commands to buy the Euro versus the US Dollar in 100-pip range from the spot are bearish (36% long / 64% short)
- The closest resistance for this pair is located at 1.1001
- At the same time, the nearest support is currently placed at 1.0949
- Important economic events to follow in the next 72 hours: France, Germany, Euro zone, US Manufacturing PMIs (Jul), US New Home Sales (Jun)
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Athens took another crucial step towards a bailout after parliament approved a second set of reforms that was demanded by Greece's creditors. The passage of the measures means that talks on an 86 billion euros bailout can begin. The reforms include changes to Greek banking system and an overhaul of the judiciary system. The bill was widely expected to be passed as it was supported by the main opposition parties, but Prime Minister Alexis Tsipras also managed to contain further defections from Syriza, and stay on in his post.
Meanwhile, Spain's unemployment rate declined in the second quarter, albeit the indicator still remains at an unhealthy high level. The jobless rate in the Euro zone's fourth largest economy dropped to 22.4% in the three months through June 30, down from 23.4% in the preceding quarter, the second highest unemployment rate in the Euro area. The Spanish jobless rate hit an all-time high of 26.94% in the first quarter of 2013.
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Upcoming fundamentals: European industrial and service sectors to continue expanding
Friday will be the day of important data releases from several European countries. French manufacturing and services PMI statistics is expected by 7:00 AM GMT today, while German figures for the same gauges will be published 30 minutes later. Meanwhile, the pan-Euro zone numbers will be announced at 8:00 AM GMT. At the moment market participants assume that all mentioned indicators for all regions will show expansion in activity.Read More: Fundamental Analysis
EUR/USD long-term outlook
Judging from EUR/USD's developments that took place since May of the previous year, the pair is clearly trading downwards on a long-term chart. At the same time, it seems that now the pair is being bounded between the 2014 low and long-term downtrend line, meaning that it is currently hovering inside the descending triangle pattern. Moreover, this pattern implies a narrowing trading range, while the break-out point can be reached by the end of September. In the medium-term the common European currency may show spikes as high as 200-day SMA and 2005 low at 1.16, but the downtrend will remain the main resistance and should be capable of pushing the cross back in the direction of 1.05-1.10 area in the long run.Daily chart
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EUR/USD short-term outlook
EUR/USD climbed to its weekly high on Thursday, by reaching the 1.10 mark, which is reinforced by 100 and 20-day simple moving averages. Moreover, the pair violated the weekly PP on its way to the north. Bulls got into long positions after a successful bounce off the May low at 1.0818, which currently acts as the most crucial support. Meanwhile, unless the 100-day SMA stays intact, the outlook is going to be unchanged and will suggest further losses for the Euro in the short-term.Hourly chart
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EUR/USD sentiment and pending orders retreat
Meanwhile, the portion of pending orders to buy the Euro against the US Dollar in 100-pip range from the spot price erased nearly all gains that have been accumulated since the beginning of this week. The share of longs slumped from 48% down to 36%.
It indicates that in case EUR/USD rises in value, the pair's near-term gains should be limited by the 100-day SMA, currently at 1.10. On the other hand, a downward development of the Euro can be extended down to May low at 1.0818.
Spreads (avg,pip) / Trading volume / Volatility
Community is undecided on perspectives of the Euro versus US Dollar this week
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Read More: Community Forecasts
Roberto3, one of the community members participating in the survey, motivates his negative outlook towards the common currency by saying that he expects "an overall downtrend and the breaking of the low at 1.0818, if the price breaks this level, it can retrace a little bit, but overall it will continue to go down again." Moreover, Jighesh adds that "the EUR/USD pair is bearish on essentially every time frame, however, it is facing some major daily support, and the US Dollar Index is pushing up against heights."
Meanwhile, traders, who were asked regarding their longer-term views on EUR/USD between Jun 24 and Jul 24 expect, on average, to see the currency pair just above 1.10 by the end of October. Though the majority of participants, namely 54% of them, believe the exchange rate will drop below this mark in ninety days, with 34% alone seeing it below 1.06. Alongside, 23% of those surveyed reckon the price will trade in the range between 1.10 and 1.16 by the end of October of this year.
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