- SWFX market sentiment is 65% bullish today
- Pending orders in the 100-pip range are set to sell in 58% of cases
- Wait for the ECB rate on Thursday
The EUR/USD has retreated to once more confirm the lower trend line of a dominant pattern. In general, the rate is expected to surge after the encounter with the pattern's line.
There haven't been any data releases impacting the EUR/USD for more than a week. However, the previous one that caught the attention of traders was the Crude Oil Price release last Wednesday.
Oil price decreased after the US Crude Oil Inventories data release on Wednesday at 14:30 GMT. The one-minute candle lost 68 pips, or 0.96% right after the data release. In the next minutes the rate was trading at the 70.10 level.
The Energy Information Administration released the US Crude Inventories data that came out lower-than-expected of 6.5M, compared to forecast 1.6M
"A tick higher in refining activity and a drop in production due to hurricane activity in the Gulf was not enough to halt a fourth consecutive climb in (inventories)- and a solid one at that," said Matt Smith, director of commodity research at ClipperData in Louisville, Kentucky.
Almost empty week
In regards to macroeconomic events this week, which might impact the EUR/USD, there are only two days to watch. Namely, Thursday and Friday.
On Thursday, the ECB Main Refinancing Rate will be published at 11:45 GMT. Afterwards, at 12:30 GMT the ECB Press Conference will impact the strength of the Euro. Dukascopy Analytics intend to host a live cover webinar of the rate announcement.
The second day will be Friday. On that day the US Advance GDP will be published at 12:30 GMT. The data release will be covered by Dukascopy Analytics on the bank's webinar platform.
In addition, note that on the same day at 14:00 GMT the ECB President Mario Draghi is set to give a speech. Although, he is set to speak at a non-essential event, and the speech most likely will not impact the Euro's strength.
EUR/USD short term review
By the middle of Tuesday's trading the EUR/USD pair was located at a strong resistance near the 1.1480 mark. If this level is passed, the currency exchange rate would surge up to the 1.1520 mark, where the weekly PP is located at.On the other hand, the pair might fail to pass the resistance and once more retreat downwards to the 1.1462 level. At that level a 50.00% Fibonacci retracement level was located at.
Hourly Chart
For now a new possible version of the dominant channel has been drawn. However, it is not to be relied on, as during the breaking of larger patterns usually a couple of versions of the patterns that represent the trend can be seen.
Instead, the passing of the weekly S1 at the 1.1425 might signal the clear end of the surge that started in August.
Daily chart
Traders were no longer almost neutral on Tuesday, as 65% of all open positions on the Swiss Foreign Exchange Market were long.
Meanwhile, traders were prepared to sell the EUR/USD under certain circumstances, as 61% of all trader set up pending orders were set to sell.
Although, if one takes into account he large number of long positions, the sell order amount is normal. The reason for that is the fact that most likely all of the long traders have pending orders in the form of stop losses and take profits.