- SWFX market sentiment is 61% short
- Pending orders in the 100-pip range are 55% to sell
- Canadian data releases take all attention
During the last trading session the EUR/USD has retreated in the borders of an ascending pattern. The retreat has stopped, as the pair found support in the lower trend line of the ascending pattern and the 55-hour simple moving average. Due to that reason a surge is expected.
The European Single Currency depreciated against the US Dollar, following the US FOMC Meeting Minutes release on Wednesday at 19:00 GMT. The EUR/USD exchange currency rate lost 34 pips or 0.30% during a minute, right after the release. The European Single Currency continued trading at the 1.1370 area against the US Dollar.
The Federal Reserve releases US FOMC Meeting Minutes where fed officials provide in-depth insights into the economic and financial conditions that influenced their vote on where to set interest rates.
The key highlight from the official statement, "Fed raises target interest rate to 2.25-2.50 pct, reduces expected hikes for 2019 to two from three."
Next up for macro traders – Canadian Trade Balance
There are notable macroeconomic and monetary events taking place this week that are scheduled to be covered by Dukascopy and are expected to cause fluctuations in the Forex market.First up on Tuesday the Canadian Trade Balance will be published at 13:30 GMT. The event is expected to cause a bounce from 10 to 35 base points.
Afterwards, Wednesday will be the busiest day of the week for macroeconomics. At 15:00 GMT the Bank of Canada will publish its Overnight Rate. The bank is set to hike their interest rate from 1.75% to 2.00%. Due to that reason the USD/CAD is expected to fall at least 50 base points.
Afterwards, take into account that the big once per week move on oil due to US Crude Oil Inventories is scheduled to occur at 15:30 GMT. During the past month oil prices bounced from 40 to 80 cents per barrel on the announcement.
The busy day will end with the FOMC Meeting Minutes publication at 19:00 GMT. During the event the market usually does not fluctuate. However, surprises are possible.
Last but not least will be the releases on Friday. UK GDP and Manufacturing Production are expected to cause a 20 pip move at 09:30 GMT. At 13:30 GMT the US CPI and Core CPI data sets might cause a 10-30 pip move.
EUR/USD daily review
During Tuesday morning hours, the European Single currency depreciated by 51 pips or 0.45% to trade below the 50.00% Fibonacci retracement level at the 1.1440 mark.In regards to the near-term future, the rate will surge upwards to meet the weekly R1 at the 1.1493 mark. Besides, the 55-hour simple moving average may support the surge for the rest of the trading session.
However, the weekly R1 could retrace the EUR/USD to push the rate to stay at the 1.1480 level during the day.
Hourly Chart
On the daily chart the recent surge has been charted in an ascending pattern.
In general, on a larger scale, the rate could reach for the upper trend line of the most dominant descending channel pattern by surging during the next couple of months.
Although, note that the rate is facing the resistance of the 100-day simple moving average at the 1.1490 mark. It is strengthening the Fibonacci retracement level, which is mentioned in the hourly chart's review.
Daily chart
On Monday, traders were shorting the EUR/USD in 60% of all cases. Namely, six out of ten traders on the Swiss Foreign Exchange had open short positions.
By the middle of Tuesday's trading session the sentiment was 61% short.
Meanwhile, trader pending orders in the 100-pip range were set mostly to sell the pair. 55% of pending orders were set to sell. Previously 61% of orders were set to sell.
In general, during the small scale decline selling has been done by the retail traders of the Swiss Foreign Exchange.