- SWFX market sentiment is 57% bearish
- 57.71% of pending orders in 100-pip range are set to SELL
- Pair opened Thursday's session at 1.1817
- Upcoming Events: US Unemployment Claims; US Existing Home Sales, US Mortgage Delinquencies
The EUR/USD forecast continues to be correct. On Wednesday the pair found support in the lower trend line of the junior channel up pattern. In the meantime, it was consistent with the expectation that Mario Draghi' speech will push the currency exchange rate higher.
The EUR/USD currency pair started a robust increase after the August PMI reports for Germany and the Euro zone came in. The Markit report were published simultaneously with the ECB President's Mario Draghi speech, which together with better-than-expected Germany's data caused a 19 base points gain in the European single currency against the Greenback, while the following report for the EZ confirmed the upmove above the 1.1762 mark.
Markit showed that the German Flash Services PMI matched estimates with a 53.4 rate, while the Manufacturing Index rose to 59.4, despite expectations for a decline in August. Data are set to diminish concerns about the stronger Euro capable of affecting manufacturing growth.
Minor US data sets
On Thursday, as it is accustomed, various minor US data sets will be published. They might make an impact on the US Dollar, if they have a large divergence from the average market forecasts. At 12:30 GMT Unemployment Claims will be out, and they are considered the ones with the largest possible impact. Later on, at 14:00 GMT, the US Existing Home Sales and Mortgage Delinquencies data sets will be released. However, these are considered as minor impact data sets. Due to that reason they are unlikely to cause an impact.
EUR/USD surges as Draghi speaks
As it was expected, previous trading session the currency exchange rate spent in an upward movement that was inspired to some extent by a combination of the weekly PP together with the 100- and 200-hour SMAs, but mostly by a speech delivered by Mario Draghi in the early morning. The only unexpected thing was that the pair managed to cross the upper boundary of a senior descending channel.
On the other hand, this overstepping had a short-term effect, which means that the pair might return back into formation. However, an aggregate of technical indicators for the 5H and 1D timeframes suggests that the rate is going to continue the surge. In the meantime, market sentiment stays 70% bearish.
Hourly Chart
The daily chart is the one, which was adjusted during the recent surge of the Euro. The reason for that is the fact that the high levels, not closing prices, of the daily chart are better to be used in pattern drawing in the case of the EUR/USD.
Meanwhile, in regards to the daily timeframe, it has to be noted that the 20-day SMA on Thursday morning was providing support at the 1.1780 mark. Meanwhile, the upper Bollinger band was supporting the weekly R1 near the 1.1850 mark.
Daily Chart
Markets are bearish on the pair
The SWFX trader open positions are 57% short. Meanwhile, on Thursday 51.68% of pending commands are to sell.
Traders of OANDA remain largely bearish, as 67.07% of open positions are short. Meanwhile, SAXO bank clients are also not changing their opinion, as 61.85% of traders are short, compared to 58.98% previously.
Spreads (avg, pip) / Trading volume / Volatility