Thread: Daily Market Analysis from ForexMart

EUR/USD Daily Analysis: July 30, 2019


The economic data will not do much to induce volatility to the EUR/USD pair prior to the release of Fed meeting. The currency pair keeps the trades close to the support at 1.12100 after a loss of 2% for the week. Meanwhile, the pair is less likely to reach below the support, prior to tomorrow’s Fed meeting.


In today’s North American session, the US inflation data will be released. Even though the release of the PCE price index will have a minor impact on the market and barely drives it to move. Hence, it is worth observing the pair. Subdued inflation is the primary reason that drove the Fed to ease its policy. At the same time, the PCE index will reflect it if this is the case.


Bids are seen in the early trading of the euro major pair at the European session and attempt to break higher. If the currency moves higher than 1.1150, a break is highly likely in the early trading range and induce a bigger recovery.


A horizontal level of 1.1188 keeps the pair from falling down after the ECB meeting last week. It seems that level remains to be a significant level with further resistance around 1.1200 handle.


Bigger resistance is at bay around the area of 1.1240 with the convergence to the level of 50- and 100-MA. Yet, it seems that the pair will not get too far on the daily trend prior to the Fed meeting.


The level below 1.1118 seems to be important as initial resistance and the major support around 1.1100 handle. This support level has kept the pair lower and it is presumed to decline in the Wednesday Fed meeting.

EUR/USD Daily Analysis: August 2, 2019


On Wednesday, the markets were signaled by the Fed that they do not intend to begin a reduction cycle. For now, they will analyze the risks of the situation and then, they will adjust the policy if needed.


In effect, this put the market to set back as they positioned on the expectation of a start of the easing cycle. However, this returned not long after for rate cut in the short-term.


The recent statement of US President Donald Trump to add a tariff on Chinese imports, signifying that trade war talks are not yet settled. In turn, this induces an aversion to risks on metals while gains are reversed on equities.


A chance for a rate cute grew in September and the money markets are almost ready to get ready for the reduction.


Moreover, the pair also showed a reversal candlestick on the daily chart. Yesterday, the bullish trend indicates a strong buying kept the pair to bid on a decline.


Despite the release of the jobs report, the market sentiment is not likely to have a big change as they are getting ready for the rate cut.


The significant resistance level is at 1.1118, which kept the pair rising higher in April-May prior to Fed decision on Wednesday. A breakout would be important and could induce a trend reversal. Nonetheless, the US employment data will bring volatility today.

EUR/USD Daily Analysis: August 5, 2019


Last week, the headlines on US president Trump publicized the imposition of tariffs on Chinese goods has had a big impact on the US dollar rate. Alongside with it, this occurred simultaneously with the markets placing bets on another rate cut in September given the dovish decision of the Fed.


Considering the CME Fed watch tool, a rate cute is probable in September by about 50 basis points in a quarter percentage chance. This is not surprising but trade tariffs add could adjust the sentiment at the next Fed meeting.


EUR/USD trend changes swiftly and whose central bank, the ECB or the Fed, will ease their policies becomes uncertain already even daily. On a positive note, it seems like the technical analysis becomes more stable even if the fundamental outlook looks hazy.


The recent gains of euro major pair were primarily due to the weakened dollar and commodity instruments are in red in this month.


The level of 1.1118 plays a significant role in the trend. An upward rally countered the earlier breakdown. Hence, it is likely for the pair to drop at the beginning of the week to be sustained in this area.


The area of 1.1118 was considered to be either resistance and support. This level limits short-term gains. If we can sustain the rally tomorrow or the day after, the next probable target is around 1.1230 given the convergence of the 50- and 100MA.

EUR/USD Daily Analysis: August 7, 2019


Recently, the news concerning the trade war between the US and China urged traders to act relative to the Chinese exchange rate.


Some resistance establishes from 200-MA on the 4-hour daily chart and a strong confluence of 50- and 100-MA to 1.1230.


A push higher than the resistance level took place on the intraday and closed below it. A Doji candle indicates exhaustion and builds a pullback. A bearish engulfing candle was seen just after the European open.


It seems that the pair is descending. A strong bullish tone pushes the rally of the pair at the beginning of the week. This also opens a chance for a reversal in the short-term. The pair returned to the 100-MA on the 4-hour chart. This can give a sign when the pair reaches the top price for the week.


In general, volatility can spark concerning the trade war. Also, there is not much going on in the economic calendar, except for the speech from Fed member Evans which remains the focus in the trading session ahead.

EUR/USD Daily Analysis: August 9, 2019


A tweet of US President Trump has once again spiked volatility but trading of EUR/USD pair still remains in the range. He remarked his disappointment in the strength of the dollar due to higher rates than other nations. Looking at the news, three central banks in India, New Zealand and Thailand had reduced their interest rates with 35, 50 and 25 basis points, respectively.


German trade balance and French industrial production data came out less than expected at the earlier part of the day, although this did not really have an impact on the trading. Another report on the producer price index will be released at the US session. Although, it doesn’t usually bring volatility.


Yesterday the euro major pair remains strong as it did not go down with just right significant resistance confluence.


The support level of 1.1188 keeps the pair from moving higher so far. Closing above this level today could lead to a reversal morning star candlestick on the weekly chart. Hence, the bidding of the pair will likely continue until next week.


Moreover, it is logical for the pair to continue range-bound trading given the quiet economic calendar.


As we noted earlier, the resistance is important while the 200-MA moves in a descending trendline on the 4-hour chart. But at the same time, the 50- and 100-MA are also considered important.


Overall, the euro major pair will persist to trade within the range and probably attempt to hold the pair prior to the upcoming trading session. The pair is likely to have a reversal pattern on the weekly chart.

EUR/USD Daily Analysis: August 15, 2019


Fed member Bullard’s view of reducing interest rates once again this year remains despite the volatility this week.


Investors’ concern rises as the yield curve shows inversion and pressure continues in the equity markets. The markets anticipate the Federal Reserve to take action and ease rates as the inversion outcome hints a possible recession. Yet, Bullard remains firm, shrugging off the market demand. This shows that the Fed would not react in every news about the US-Sino trade war.


Although volatility has been apparent in various assets, the euro major pair isn’t exactly one of them as it continues to fluctuate on its average range.


Yesterday’s range kept a bearish tone but the expected data to come out more than the technical aspect that pushes the pair. The US retail sales, as well as Philly Fed manufacturing index and unemployment claims, will be released today.


The EUR/USD pair moved lower because of a strong dollar and broke the confluence of support.


The indicator limits the downward range of the pair that has been going on since early last week and now it is broken. This looks like an obstacle on the upside. At the same time, a horizontal level was seen close to the moving average of 1.1155 that prompted a confluence at the resistance.


Below, the major support level is at 1.1118, which keeps the pair higher than April and May. Moreover, this keeps the pair higher in latter July on the 4-hour chart.


The pair seems to be testing the lower limit of the descending trend channel, although it may be too early to decide whether it will sustain the downward trend.

EUR/USD Daily Analysis: August 16, 2019


A bullish morning star pattern was seen after the surge of the EUR/USD pair last week. Yet, the significant support level of 1.1118 is not yet established, which means that the bears can be in control of the movement. This area is important as this held various declines for this aside from a short drop below in latter days of July.


On Thursday, US economic data was released that shows better than forecast that supports the US dollar. Retail sales grew by 0.7% in July, more than the 0.3% forecast of an increase. This excludes the automobile and gas, which then prompted the data to increase by 1.0%.


Trade balance from Eurostat is also to be released soon. Also, there is the consumer sentiment and building permits from the United States. Although, there are not likely to keep the impact on the exchange rate.


The significant level of EUR/USD pair was broken and there will also be not many purchases. Moreover, the pair begins to enter the oversold zone on the 4-hour chart.


The support level is around the area of 1.1075, which makes the lowest close on a daily basis for the year. Moving forward, the next probable target is around 1.1027, which was the August low.


It is not likely for the pair to break again for another fresh yearly low today, considering few expected fundamental events on the economic calendar.


Closing of the pair today is relevant. If the pair manages to keep the current levels, there will be a reverse bullish trend of last week’s reversal pattern. More importantly, this will confirm the resumption of the EUR/USD downtrend.


The overall momentum of the EUR/USD pair is downward, although the pair begins to oversell on the 4-hour chart. In comparison to a basket of major currency pairs, the common currency is likely to have its biggest loss. Yet, even if there is a light economic schedule, the news may induce some volatility in the pair.

EUR/USD Daily Analysis: August 20, 2019


The euro major pair faces pressure for the whole week but still, the dollar strengthened as the DXY index rises higher than the resistance. It was able to close higher than 98.25 daily level, which was the same level that kept the price lower in April and May and almost close to the two-year high.


Although the decline is not purely because of the EUR/USD pair as the euro is pressured against major currencies over the past week. Market's attention will then shift to the upcoming Fed meeting on Wednesday. For now, there is the PPI from Germany which is expected to come out higher than the forecast.


The levels of 1.1075 (upper) and 1.1118 (lower) were important yesterday. The previous level was kept as sellers entered the market prior to reaching the latter level, which also limited the recovery. The price movement shows weakness, especially in an attempt to test again the support level today.


Moreover, it is important to see how far the pair can go and if it will reach a fresh new yearly low prior to the Fed meeting tomorrow. Thus, it may not be wise to push the price lower in the current condition.


At a later session, we can expect resistance to continue around 1.1118 amid a rally. It needs to reach the level higher in changing the short-term direction of the pair.


A breakdown at 1.1075 opens the yearly low at 1.1027. If it successfully moves lower than 1.1027 today, then we might encounter some stops. In spite of that, the pair might have a difficult time to break the level and keep the flow without a specific driver to cause such movement.


There are not many events to look out for in the economic calendar prior to the expected Fed meeting on Wednesday.

EUR/USD Daily Analysis: August 22, 2019


In the beginning, the market reaction induced volatility. However, the euro major pair kept the pair in range and was ahead for the week. At the same time, the future markets have revised lower their expectations for further reduction. Although, they have already priced in another cut in September.


The result of PMI data has kept strong bidding at the beginning of Thursday trading. Other data including the Manufacturing and Services PMI figure of France, Germany, and the Eurozone came out better than expected by analysts.


The euro major pair rallied upward outside its most recent range amid the release of data and prior to losing a bit of its strength.


In the technical analysis, the EUR/USD support level is at 1.1074, which was the lowest daily close in 2019. Also, the US dollar index (DXY) begins to pull back from the resistance level of 98.25.


If the pair keeps the price higher than the support level, then there is a higher chance for recovery. However, a break above the 1.1118 mark could confirm the recovery of the pair, which was a horizontal level that drops slightly higher than the range high.


Looking at the fundamental news, the ECB will release the Fed minutes today, particularly the PMI figure. Aside from that, the symposium at Jackson Hole will begin today for three days.


Hence, the euro major pair will likely trade range-bound but various events could affect the pair and induce a breakout, especially with the Jackson hole symposium.

EUR/USD Daily Analysis: August 27, 2019


The Friday rally of the EUR/USD pair was a result of various events, which means that it is just not solely because of concerns in trade war. Soon after, this has changed as President Trump mentioned trade talks are still ongoing.


The common currency faces various risks and has had fluctuations amid the recent shift. Although, this may not be apparent compared to other currency pairs. Trump’s recent comments regarding a phone call between the two nations will likely have an impact on the session ahead.


German GDP data showed a drop by 0.1% in the second quarter as expected. The common currency was not affected after the release of data.


Another data from France came out, particularly the consumer confidence reaching an 18-month high. In the afternoon, data from the US is anticipated to be released.


The euro major pair was found to have a significant confluence of the support with both 50- and 20-MA on the 4-hour chart.


For now, the euro major pair is trying to recover from a sharp decline on Monday. It looks like the support level will be found at this level. Meanwhile, the initial resistance level is at 1.1118, which kept the pair lower on Friday.