- SWFX market sentiment is 65% bullish (+1%)
- 63% of pending orders in 100-pip range are to SELL the Euro
- Bank Holiday in Germany and France
- Upcoming fundamental events: US CPI m/m, US Core CPI m/m
Technical indicators signal to bullish momentum today.
The Greenback weakened against the Eurozone's single currency, following US PPI data release on Wednesday. The EUR/USD currency pair gained only five pips, or 0.04%, to continue fluctuating in the 1.1877 area.
The Bureau of Labor Statistics released two data simultaneously, where Producer Price Index data came out lower-than-expected of 0.10%, but Producers Price Index Core data came out as expected of 0.20% for the month of April.
Wholesale inflation slowdown in the US was weighed down by declining prices in clothing, health and beauty and accommodation services.
US inflation data to come out
Banks in Germany and France are closed in this session, thus no major activity is expected from the Euro side.
Meanwhile, the US Bureau of Labour Statistics is to release the Consumer Price Index and the Core Consumer Price Index for April at 1230GMT. Analysts expected that inflation has increased by 0.3% and 0.2%, respectively, during this period.
EUR/USD expected to gain bullish sentiment
By Thursday morning, the Euro had returned near the combined resistance of the weekly S1 and the 55-hour moving average. Technical indicators are starting to recover both on the 1H and 4H time-frames, demonstrating that the expected medium-term appreciation might be under way.
The base scenario for this session favours a breakout from the 1.1880 area and a subsequent surge to the 100-hour SMA at 1.1920. This level should likewise surrender and allow for further advance towards 1.20.
Hourly Chart
The common European currency continues to fall against the US Dollar for the third consecutive week. This massive decline has sent daily technical indicators in the strongly oversold territory.
It was initially though that a reversal might occur near the 1.22 mark. However, the decline of the Euro has continued as low as the 1.19 level. The nearest support is set by the weekly S2 at 1.1825; thus, the pair might still edge lower for some time until a bullish recovery occurs during the second part of this week.
Daily Chart
Bulls remain in charge
EUR/USD remains strongly bullish with 65% of open positions being long (+1%).
The outlook for the two currencies against the rest of the traded financial instruments is as follows: the Euro is 53% bullish and the US Dollar is 62% bearish.
The market sentiment of OANDA is 53% bullish, compared to market equilibrium on Wednesday. Meanwhile, Saxo Bank clients have maintained the same level of sentiment with 53% of open positions being short.
Spreads (avg, pip) / Trading volume / Volatility