- SWFX market sentiment is 52% bullish
- Trader pending orders are 61% to sell
- Pair opened Monday's session at 1.0563
- Upcoming Events: US Core Durable Goods Orders, US Durable Goods Orders, US Pending Home Sales, FOMC Member's Kaplan's Speech, EU M3 Money Supply
The number of Americans filing for unemployment benefits increased slightly more than expected last week, though the four week average dropped 4,000 to 241,000, weakest level since 1973, official figures revealed on Thursday. Last week's results were driven by growing economy and tight labor market, which is likely to prompt companies to retain experienced workers, supporting wage growth. According to the US Department of Labor, national jobless claims rose 6,000 to 244,000 during the week ended February 17 from the preceding week's upwardly revised 238,000. Meanwhile, economists anticipated an acceleration to 242,000 during the reported period. Filings have been holding below 300,000 for 103 straight weeks, showing healthy signs of the US job market.
In the meantime, continuing claims fell 17,000 to 2.06 million during the week ended February 11, while their four-week moving average dropped 10,750. Overall, the Federal Reserve is widely expected to increase interest rates fairly soon, with labor market and inflation data set to reveal better performance. The last time the Fed raised its benchmark overnight rate was in December last year, when the rate was increased from 0.5% to 0.75%.
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Upcoming events: Several important data releases in US
The fundamental events in the US today consist of several important data releases and a speech by FOMC member Kaplan at 16:00 GMT that might hint at new plans for changes in the US monetary policy. Today, at 13:30 GMT, the US Durable Goods Orders and Core Durable Goods orders, which will reveal the amount of orders for the products with life expectancy higher than 3 years, will be released. Another data release scheduled for 15:00 GMT, US Pending Home Sales, might affect the financial markets. From these data releases, the US Durable Goods data release is scheduled to be covered by the Dukascopy research team on the live webinar.
Read More: Fundamental Analysis
EUR/USD begins week below 1.06 level
Daily Chart: The common European currency started the week higher against the US Dollar than the Friday's closing price. With a new week the new levels of significance have been calculated, and the weekly PP at 1.0562 began to provide support to the currency exchange rate. As a result of the before mentioned facts, the currency pair began a surge. The Euro is set to surge up to the closest notable resistance level at 1.0591, which is represented by the 55-day SMA. The simple moving average is likely to hinder the pair's surge, if not even reverse it.Daily chart
© Dukascopy Bank SA
Hourly chart: The hourly chart reveals that the common European currency is located between a strong support and resistance levels and is therefore squeezed in the middle. The Euro is unable to break the resistance level consisting of 200-hour SMA at 1.0588 and upper Bollinger Band at 1.0587. It is also unable to go through the support cluster consisting of 20, 55-hour SMA at 1.0573 and 1.0572 respectively. The "squeezing" effect is also reinforced by the upper and lower Bollinger bands closing in towards the current exchange rate. It is therefore likely, that the pair would continue to bounce between the aforementioned clusters in the short-term perspective during today's trading session.
Hourly chart
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Read More: Technical Analysis
Markets less bullish on EUR/USD
SWFX traders have decreased their bullish sentiment, as 52% of open positions are long on Monday, compared to 54% on Friday. Meanwhile, 61% of trader set up orders are set to sell the Euro.
OANDA traders have decreased their bullish view on the pair, as 54.26% of trader open positions are long at the marketplace, compared to 55.95% previously. Alternatively, SAXO bank clients are slightly less bearish on the pair, as 51.24% of the bank's clients are shorting the pair, compared to 51.92% on Friday.
Spreads (avg,pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.07 in May
Traders, who were questioned on their longer-term views on EUR/USD between January 27 and February 27 expect, on average, the currency pair to trade around 1.07 by the end of May. In general, 47% (-1%) of participants believe the exchange rate will be generally below 1.06 in ninety days, and 27% (+1%) see it below 1.02. In the meantime, 17% of those surveyed reckon the pair will trade above 1.12 in three months. © Dukascopy Bank SA