- SWFX market sentiment is 60% bearish
- 60.10% of pending orders in 100-pip range to sell
- Pair opened Wednesday's session at 1.1802
- Upcoming Events: US ADP Non-Farm Employment Change
On Wednesday morning the EUR/USD currency pair remained near the 1.18 mark. The reason for the remaining near the previous level was the fact that the pair had overextended its gains. From a technical perspective it was the upper trend line of an ascending channel and the upper daily Bollinger band, which forced the Euro into a short term retreat against the US Dollar.
Firmly confident figures for the Euro zone's inflation contributed enough to bring the EUR/USD currency pair to a new high on Monday. The Euro advanced against the US Dollar by 0.09% to reach the 1.17429 level following the release of the flash CPI data for July, which managed to satisfy analysts' expectations. Eurostat revealed its flash estimate for inflation in the Euro area rose 1.3% in the reported month, unchanged from June, while the core measure edged higher to 1.2%, above economists' forecasts for a 1.1% increase. Nevertheless, despite consumer prices growth remaining below the ECB's 2% target, the ongoing economic expansion across the 19-country bloc added to confidence that inflation would gradually rise towards the target level.
ADP data
On Wednesday, in regards to the US Dollar, all eyes will be on one data release. The ADP Non-Farm Employment Change data will be published at 12:15 GMT. The data release will be covered by the Dukascopy Research team on the bank's live webinar platform.
EUR/USD prepares to start from weekly R1
Contrary to expectations, an announcement of the US Manufacturing PMI caused only an eight basis points market reaction. Thus, due to absence of any sizable fundamental events, the currency exchange rate spent previous trading session in a flat and steady movement along the weekly R1 at 1.1815, crossing it multiple times in both directions. Today the pair is expected to use an upside momentum provided by the approaching 55-hour SMA in conjunction with the lower support line of a rising wedge and try to climb to the weekly R1 located at the 1.1878 level. A number of technical indicators support this scenario, sending signals to buy the pair. On the other hand, SWFX traders continue to remain bearish on the pair even though not as strong as yesterday.
Hourly Chart
The daily chart reveals that the pair's recent decline was caused by the upper trend line of a medium term ascending channel pattern, which can be observed on the charts. Moreover, the upper trend line was supported by the upper Bollinger band of the hourly chart. Most likely these resistance levels will strengthen the weekly R1.
Daily Chart
Markets remain bearish
The situation in the SWFX markets remains unchanged, as SWFX traders are 60% short in regard to the EUR/USD pair. Meanwhile, total number of SWFX trader set up orders are 51.73% bullish.
Traders of OANDA remain bearish, as 64.85% of open positions are short. Meanwhile, SAXO bank clients are also not changing their opinion, as 63.43% of traders are short, compared to 64.27% previously.
Spreads (avg, pip) / Trading volume / Volatility