- SWFX market sentiment is 54% bearish
- 51% of pending orders in 100-pip range are set to SELL
- 52% of traders are bullish on the Dollar
- Upcoming Events: German Ifo Business Climate, US Building Permits, Current Account and Housing Starts
In result of formation of the head and shoulders pattern, the currency rate managed to break above the monthly PP at 1.1806. Today the pair is generally expected to test the upper-boundary of a senior falling wedge formation.
The US Dollar continued to depriciate against the Euro following the release of weaker-than-expected US data. The EUR/USD currency pair registered a 0.04% plunge, hitting the 1.17887 mark right after the data were announced.
Industrial output in the US rose less than anticipated in November, as a decline in utilities production offset a post-hurricane jump in the gas and oil industries, the Federal Reserve stated on Friday. Overall industrial production rose 0.2%, following an upwardly-revised gain of 1.2% in the prior month and missing the expectations for a 0.3% surge. Meanwhile, the US manufacturing sector, which draws up nearly 12% of the country's economy, also grew 0.2% in the reported month.
German business sentiment
From the European side, the main event will happen at 9:00 GMT with release of information on German business sentiment. In the United States it might we worth to pay attention to publication of data on state of the American housing market at 13:30 GMT.
EUR/USD starts new day above Mas
Despite increasingly positive stance on the Dollar, the Euro continued to inch higher yesterday, being driven by the minor head and shoulders pattern. As the currency rate managed to end previous trading session above the combination of 55-, 100- and 200-hour SMAs as well as the weekly PP, they are expected to provide support for further advance. Accordingly, the main target for the pair would an intersection of the monthly PP and the upper trend-line of a senior descending channel. Whether the exchange rate will manage to break this barrier will heavily depend on result of today's vote in the Congress. An adoption of tax reform might push the rate down to the 38.2% Fibonacci retracement level at 1.1760, while the opposite result is likely to elevate the rate straight to the last week high at 1.1845.
Hourly Chart
Appreciation of the Euro during previous trading session points out on existence of another ascending channel that represents a part of a dominant descending pattern. If this assumption is true, then currency rate should continue moving upwards, trying to reach an area near the 1.1880 mark.
Daily Chart
Market sentiment is bearish
In result of the previous trading session the bearish market sentiment has not change, as 54% of open positions are short now.
In the meantime, the outlook for the two currencies against the rest of the traded financial instruments is the following: the Euro is 60% bearish and the Dollar is 52% bullish.
Traders of OANDA remain bearish, as 55% (+1%) of open positions are short. Meanwhile, SAXO are bearish on this currency pair with 58% (+2%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility