- SWFX market sentiment is 51% short
- Pending orders in the 100-pip range are set to sell in 55% of cases
- Parliament Brexit vote is cancelled
The Euro has felt some spill over from the British Pound, as the Brexit Parliament vote has been cancelled by the Prime Minister of the United Kingdom. The event resulted in a decline, which had already ended on Wednesday. The rate had begun to recover, as it surged back up to face resistance levels at 1.1390.
The European Single Currency appreciated against the US Dollar, following the US ADP Non-Farm Employment Change data release on Thursday at 13:15 GMT. The EUR/USD exchange currency rate gained 15 pips or 0.13% during a minute, right after the release. The European Single Currency continued trading at the 1.1360 area against the US Dollar.
The Automatic Data Processing, Inc. released the US ADP Non-Farm Employment Change data that came out lower than expected of 179K, compare to forecasted 195K.
Ahu Yildirmaz, the Vice President and Co-Head of the ADP Research Institute said, "Although the labor market performed well, job growth decelerated slightly. Midsized businesses added nearly 70 percent of all jobs this month. This growth points to the midsized businesses' ability to provide stronger wages and benefits. It also suggests they could be more insulated from the global challenges large enterprises face."
Brexit vote has been cancelled
On Tuesday the UK Average Earnings Index and Unemployment Rate are set to be published at 09:30 GMT. This data release usually causes a reaction on the GBP/USD from 15 to 30 pips.Meanwhile, on Tuesday the US Producers Price Index will be released at 13:30 GMT. This data release is set to slightly impact all the pairs that involve the US Dollar. For example, the EUR/USD could bounce around ten pips on the release.
On Wednesday, the US Consumer Price Index change will be published at 13:30 GMT. The event is expected to cause around 20 pip reaction on the EUR/USD.
Note that on Wednesday the biggest move that can be caught will occur on the oil price benchmarks. Namely, at 15:30 GMT the US Crude Oil Inventories data release will cause a sudden move of more than one percent.
On Thursday, the attention will be taken by central bank rate announcements. Namely, at 08:30 GMT the Swiss National Bank will publish their rate and at 12:45 the ECB will publish their interest rate.
The last day of the week will have two notable data releases. At 09:00 GMT the European Manufacturing and Services PMI's created by Markit will be published.
Afterwards, the US Retail Sales data sets will be out at 13:30 GMT. The event might cause a 20 pip bounce.
All of the above mentioned data releases will be covered by Dukascopy Analytics. The events can be watched either on the bank's webinar platform or on our YouTube channel.
EUR/USD daily review
On Tuesday morning, the EUR/USD was regaining its previous losses. The EUR/USD had halted its surge at the 55-hour simple moving average at the 1.1388 level.It was expected that the currency exchange rate will break the resistance and continue its surge. In that scenario the pair will face no resistance as high as the 1.1430 level, where the weekly R1 is located at.
On the other hand, the pair might trade sideways until additional support in the form of the 100 and the 200-hour simple moving averages approaches.
Hourly Chart
The daily chart's junior pattern has bene broken. It signals that there might be another surge in the borders of the larger patterns until the rate reached the upper trend line of the most dominant pattern.
Although, that can happen in more than a couple of ways. Horizontally, by surging upwards or by trading in zig-zags for the next couple of months.
Meanwhile, take into account that the resistance of the 55 and 100-day simple moving averages respectively at 1.1430 and 1.1510 will be providing resistance to a possible surge.
Daily chart
On Monday, 55% of trader open EUR/USD positions were short. During the decline some traders took profit, as 52% of orders were short on Tuesday morning.
Meanwhile, trader pending orders in the 100-pip range were set to sell in 54% of cases. The orders had been almost neutral for more than a week.
In general, some traders profited from the decline of the EUR/USD. Although, it seems that it was unintentional, as most market participants did not expect the recent events at the British Parliament.