EUR/USD – Euro Points Higher As ECB Considers Non-conventional Monetary Measures

EUR/USD continues to post gains on Tuesday, as the pair is trading in the mid-1.37 range in the European session. The euro received some support after ECB policymakers said non-conventional easing measures remain on the table. In economic news, the French trade deficit narrowed last month, dropping to its lowest level in over three years. In the US, today’s highlight is JOLTS Job Openings. The markets are expecting a slight improvement in the March reading.

It was more of the same from the ECB last week, as the central bank stood pat and did not make any moves, despite serious worries about weak growth and low inflation. On Tuesday, ECB policymaker Yves Mersch said that ECB officials were working on a QE scheme in order to combat deflationary pressures, but added that there was no immediate need for such a program. Meanwhile, Bundesbank President Jens Weidmann said that monetary policy alone will not solve the Eurozone’s economic problems, saying that political leaders must undertake fiscal and other reforms.

German data continues to beat expectations, as the Eurozone’s largest economy continues to post respectable numbers. Industrial Production dropped to 0.4%, down from 0.8% a month earlier, but this edged above the estimate of 0.3%. Last week, German Retail Sales, Unemployment Change and Factory Orders all beat their estimates, as the German economy appears to be moving in the right direction.

 

EUR/USD for Tuesday, April 8, 2014

Forex Rate Graph 21/1/13

EUR/USD April 8 at 10:50 GMT

EUR/USD 1.3767 H: 1.3738 L: 1.3674

 

EUR/USD Technical

S3 S2 S1 R1 R2 R3
1.3410 1.3585 1.3649 1.3786 1.3893 1.4000

 

  • EUR/USD continues to post gains on Tuesday.
  • 1.3649 is providing support. 1.3585 is the next support line.
  • On the upside, 1.3786 is under pressure as the euro trades at higher levels. The next line of resistance is 1.3893, which is protecting the 1.39 level.
  • Current range: 1.3649 to 1.3786

Further levels in both directions:

  • Below: 1.3649, 1.3585, 1.3410 and 1.3335
  • Above: 1.3786, 1.3893, 1.4000, 1.4149 and 1.4307

 

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in short positions on Tuesday, reversing the direction seen a day earlier. This is not consistent with the pair’s current movement, as the euro has edged upwards. Short positions retain a strong majority, indicative of trader bias towards the dollar reversing its current direction and moving higher.

EUR/USD has posted modest gains on Tuesday. The pair is almost unchanged in the European session.

 

EUR/USD Fundamentals

  • 6:45 French Government Budget Balance. Actual -25.7B.
  • 6:45 French Trade Balance. Estimate -4.9B. Actual -3.4B.
  • 11:30 US NFIB Small Business Index. Estimate 92.3 points.
  • 14:00 US JOLTS Job Openings. Estimate 3.99M.
  • 17:30 US FOMC Member Narayana Kocherlakota Speaks.
  • 18:45 US FOMC Member Charles Plosser Speaks.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.