- SWFX market sentiment is 58% bearish
- 58% of pending orders in 100-pip range are set to SELL
- 54% of traders are bullish on the Dollar
- Upcoming Events: US PPI and Unemployment Claims, ECB Draghi Speaks
The Euro continued to gain value against the Dollar, as FOMC meeting minutes showed that there are still some uncertainties about the need of another interest rate hike this year. The fact that the pair reached the monthly PP at 1.1875 suggests that it might continue the soar towards the upper trend-line of a dominant descending channel. However, a bunch of the indicators point out on an upcoming rebound.
EUR/USD fell slightly after the weak JOLTS openings report, though the decrease was offset twice as the pair remained in the bullish run, which was confirmed after the FOMC Meeting Minutes' release. Following the second publication, the US Dollar lost against the European single currency 10 base points to return in the area above the 1.8550 mark.
The JOLTS survey showed that the number of the US job openings declined to 6.08M in August, from a downwardly revised figure of 6.14M in the prior month, facing negative impacts coming from the Hurricane Harvey. Subsequent release of the Fed meeting minutes revealed that some central bankers remained concerned on persistently weak inflation growth, which is likely to determine the need of the interest rate hike.
American PPI release
Today there are scheduled two important events that are expected to shake the given currency pair. The first one will happen at 12:30 GMT when the Bureau of Labor Statistics will release on update on the US PPI as well the number of Unemployment Claims. Later at 14:30 GMT the ECB President Mario Draghi will participate in discussion about monetary policy at the Peterson Institute for International Economics.
EUR/USD soars to monthly PP at 1.1875
The common European currency continues to advance against the US Dollar four days in a row, fluctuating in a junior ascending channel. As some of the FOMC members were still uncertain about necessity of interest rate hike in December, the pair gained an impulse to reach the monthly PP at 1.1875. The fact that an average market sentiment became 69% bearish points out on an upcoming turnaround. Similar signal show certain technical indicators suggesting that the rate is overbought. On the other hand, there is a need to take into account that the pair is also moving and tends to reach the upper boundary of a large descending channel. In other words, whether the rate makes a rebound on continues the surge will greatly depend on the US PPI release and reaction on Mario Draghi speech.
Hourly Chart
From daily perspective, the pair is about to start testing the monthly PP at 1.1875. The fact that it has recently made a breakout from the falling wedge pattern and now is backed up by the 55-day SMA suggests that it should continue the surge towards the upper edge of a large descending channel. On the other hand, an average market sentiment turned to be very bearish, which might be interpreted as a sign of an upcoming rebound.
Daily Chart
Traders become neutral
In result of the previous trading session the bearish market sentiment slightly increased, as 58% 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 61% bearish and the Dollar is 54% bullish.
Traders of OANDA remain bearish, as 62% (+2%) of open positions are short. Meanwhile, SAXO are also bearish on this currency pair with 63% (+4%) of open short positions.
Spreads (avg, pip) / Trading volume / Volatility