- SWFX market sentiment is neutral
- Pending orders in the 100-pip range are neutral
- Note important US fundamentals regarding trade with China
The EUR/USD pair has surged to the upper trend line of a dominant descending channel pattern near the 1.14 mark. From a technical perspective the rate is expected to bounce off of this resistance level and decline. In that case it would descend down to the 1.1350 mark where three simple moving averages are located at.
The European Single Currency appreciated against the US Dollar, following the US FOMC Meeting Minutes release on Thursday at 19:00 GMT. The EUR/USD exchange currency rate gained 18 pips or 0.16% during a minute, right after the release. The European Single Currency continued trading at the 1.138 area against the US Dollar.
The Federal Reserve releases US FOMC Meeting Minutes where fed officials provide in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.
The minutes said, "Almost all participants expressed the view that another increase in the target range for the federal funds rate was likely to be warranted fairly soon".
First week of the month is the busiest one
On Tuesday, traders will concentrate on the UK Construction PMI on Tuesday at 09:30 GMT. The data release is expected to cause a minor reaction on the GBP/USD pairs.On Wednesday, the ECB President Draghi might impact the EUR/USD during his speech at 08:30 GMT.
Afterwards, note the UK Services PMI release at 09:30 GMT. This event will be covered by Dukascopy Analytics
That will not be all on Wednesday. At 15:00 GMT the Bank of Canada will make interest rate announcement. This event has caused the largest fluctuations in the forex markets during 2018. This will be the top event for the month for macroeconomic event traders.
Meanwhile, note that there are changes in the calendar due to the funeral of George Bush senior. Namely, Wednesday's events in the US have been moved to Thursday.
At 13:15 GMT on Thursday the ADP Non-Farm Employment change will be published and covered by Dukascopy Analytics on the bank's webinar platform and YouTube channel.
Moreover, the weekly Crude Oil Inventories will be published at 16:00 GMT. This data release causes bounced in oil prices from half a dollar up to ninety cents.
The day will end with the head of the Federal Reserve testifying before the US Congress at 11:45 GMT.
Last but not least will be the Friday's monthly US and Canadian employment data release at 13:30 GMT. This event will also be covered by Dukascopy Analytics.
EUR/USD daily review
During Monday's trading session, the currency exchange pair broke the resistances of the SMAs to end the trading session at 1.1350. On Tuesday morning, the European Single Currency was supported by the simple moving averages to trade at the 1.1374 mark.In regards to the near-term future, most likely, the European Single Currency will break the upper boundary of the descending medium pattern at 1.1380 level.
However, the weekly R1 at the 1.1394 mark could resist the European Single Currency and force the rate to trade sideways to stay at the 1.1360 level during the trading session on Tuesday.
Hourly Chart
On the daily chart the currency exchange rate remains in the borders of the descending channel pattern. In the longer term the decline is still expected to occur.
Due to the reason that the hourly and daily charts contradict one another pay close attention to the 1.14 level. If it gets passed, the rate could jump to 1.1460.
Daily chart
Since Monday, the trader open positions on the Swiss Foreign Exchange in regards to the EUR/USD had become perfectly balanced 50/50. Meaning, half of traders were long and the second half were shorting the pair.
Meanwhile, trader pending orders in the 100-pip range were set to buy the EUR/USD in 53% of all cases on Monday. On Tuesday morning they had also become balanced.
This indicates that a push either upwards or downwards will be caused by the larger players in the forex market and not the retail traders.