- SWFX market sentiment is 51% bullish
- Trader pending orders are 61% to sell
- Pair opened Wednesday's session at 1.0565
- Upcoming Events: ADP Non-Farm Employment Change
Economic activity in the US services sector rose unexpectedly last month, official figures showed on Friday. The Institute for Supply Management reported its Purchasing Managers' Index for the services sector climbed to 57.6 in February, while market analysts expected the Index remain unchanged from the prior month's reading of 56.5 during the reported period. Any reading above the 50-point level indicates activity expansion in the services sector. Furthermore, the Non-Manufacturing Business Activity Index came in at 63.6, the highest level since February 2011, up from the previous month's 60.3. Data also showed the New Orders Index increased to 61.2, the highest since August 2015, following January's 58.6. The ISM said 16 out of 18 industries reported growth last month, adding that the share of companies expressing a positive outlook for the future rose markedly last month despite the existing uncertainty in the US economy. Economic activity contracted in the information industry and the real estate, rental and leasing industry in February.
After the release, the US Dollar hit its intraday high of 114.54 against the Japanese Yen but failed to maintain its gains as investors awaited a speech by the Fed Chair Janet Yellen in the day
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Upcoming events: ADP Non-Farm Employment Change
During Wednesday's trading session there is one notable data release scheduled to occur. That would be the ADP Non-Farm Employment Change at 13:15 GMT. It will be covered on the live webinar by the Dukascopy research team, and the coverage is set to begin 20 minutes before the release, which is at 12:55 GMT.
Read More: Fundamental Analysis
EUR/USD continues to decline
Daily Chart: On early Wednesday morning the common European currency was slowly continuing its way lower against the US Dollar. The rate had finally broken free from the grip of the weekly PP at 1.0582, around which the currency exchange rate was fluctuating around for almost 48 hours. The currency pair is set to fall next to the weekly S1, which is located at 1.0533 level. It is most likely that the decline will occur gradually, as there are minor support levels, which have proven themselves to be strong enough to even change the direction of the rate for short periods of time.Daily chart
© Dukascopy Bank SA
Hourly chart: The hourly chart for the EUR/USD currency exchange rate shows that the pair is still trading in the descending channel pattern, which was spotted a few trading sessions ago. Yesterday the rate rebounded against the channel's lower trend line and surged back above the weekly PP for a short moment before continuing the retreat. In the meantime, the currency pair is also heavily supported by the 100 and 200-hour SMAs, which are located near the 1.0565 mark.
Hourly chart
© Dukascopy Bank SA
Read More: Technical Analysis
Traders not changing their positions
For the third consecutive trading session SWFX traders remain neutral bullish, as 51% of open positions are long on Wednesday. Meanwhile, 61% of trader set up orders are to sell the Euro.
OANDA traders bounce around the neutral zone, as 52.84% of trader open positions are long on Wednesday, compared to 51.08% short positions previously. In addition, SAXO bank clients have a similar tendency, as 50.52% of open positions are long, compared to 51.35% short positions on Tuesday.
Spreads (avg,pip) / Trading volume / Volatility
Average forecast says EUR/USD will trade around 1.06 in April
Traders, who were questioned on their longer-term views on EUR/USD between February 8 and March 8 expect, on average, the currency pair to trade around 1.06 by the start of April. In general, 47% (-2%) of participants believe the exchange rate will be generally below 1.06 in ninety days, and 25% (-1%) see it below 1.02. In the meantime, 14% (+1%) of those surveyed reckon the pair will trade above 1.12 in three months. © Dukascopy Bank SA