- SWFX market sentiment is 74% short
- Pending orders in the 100-pip range are neutral
- Bank of Canada and Federal Reserve events today
After finding support in the 1.1425 level the EUR/USD has once more reached up t the 1.1480 mark on Wednesday. In general the surge is set to continue. Meanwhile, note that the Federal Reserve will publish their Meeting Minutes at 19:00. The markets expect that the Federal Reserve will ease their policy. That should cause a EUR/USD surge.
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."
The day of the central banks
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.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 Wednesday morning hours, the European Single Currency broke the resistance of the 50.00% Fibonacci retracement level at the 1.1465 mark to trade towards the weekly R1 at the 1.1493 mark.Most likely, the currency exchange rate will continue the uptrend towards the 1.1500 level. The 55-hour simple moving average and the bottom boundary of the ascending pattern line at 1.1460 mark should support the rate during the day.
On the other hand, today's US FOMC Meeting Minutes at 19:00 GMT could push the European Single Currency to depreciate against the US Dollar to the 1.1420 level.
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
The traders started suddenly shorting the EUR/USD on Wednesday, as the short proportions take up 74% of all open positions on the Swiss Foreign Exchange. On Tuesday, 61 %of traders were short.
Meanwhile, trader pending orders in the 100-pip range were neutral. Previously, sell orders dominated.
Although, the EUR/USD surged slightly during the last 24 hours, traders have sold it and even, in the opinion of Dukascopy Analytics, oversold the pair.