EUR/USD – Stable Ahead of ECB Rate Statement

EUR/USD is showing little movement on Thursday, as the pair continues to trade in the mid-1.31 range in the European session. On the release front, German Factory Orders sparkled, climbing 4.6% last month. Later in the day, the ECB is expected to maintain its minimum bid rate at 0.15%. In the US, it’s a busy day, with four key releases on the schedule – ADP Nonfarm Payrolls, Trade Balance, Unemployment Claims and the ISM Non-Manufacturing PMI.

Recent German numbers have not impressed lately, and weakness in the Eurozone’s largest economy has been weighing on the struggling euro. However, there was excellent news from German Factory Orders, which jumped 4.6% last month, following two straight declines. The reading easily beat the estimate of 1.6%. Later in the day, the ECB will set its interest rate level for August. No changes are expected from the ECB, but the markets will be closely monitoring Mario Draghi’s press conference, which could be a market-mover.

US data continues to point to a  deepening economic recovery in the US. On Tuesday, ISM Manufacturing PMI impressed the markets, climbing to 59.0 points, its best showing since April 2011. The index easily beat the estimate of 57.0 points. The strong showing follows an unexpectedly strong GDP, which hit 4.2%. With the US and European economies moving in opposite directions, the US dollar has responded with its highest levels against the euro since September. Employment data will be in the spotlight for the remainder of the week, with the release of ADP Nonfarm Payrolls and Unemployment Claims on Thursday, followed by the official Nonfarm Payrolls and the unemployment rate on Friday.

 

EUR/USD for Thursday, September 4, 2014

EUR/USD September 4 at 9:15 GMT

EUR/USD 1.3149 H: 1.3154 L: 1.3136

 

EUR/USD Technical

S3 S2 S1 R1 R2 R3
1.2806 1.2984 1.3104 1.3175 1.3295 1.3346

 

  • EUR/USD has been uneventful in the Asian and European sessions, as the pair stays close to the 1.3150 line.
  • 1.3175 remains an immediate resistance line. 1.3295 is stronger.
  • On the downside, 1.3104 is providing weak support. 1.2984 is the next support level.
  • Current range: 1.3104 to 1.3175

Further levels in both directions:

  • Below: 1.3104, 1.2984, 1.2806 and 1.2641
  • Above: 1.3175, 1.3295, 1.3346 and 1.3487

 

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in short positions on Thursday. This is not consistent with the pair’s current lack of movement. EUR/USD continues to show a strong majority of long positions, indicative of trader bias towards the euro breaking out and heading to higher ground.

 

EUR/USD Fundamentals

  • 6:00 German Factory Orders. Estimate 1.6%. Actual 4.6%.
  • 8:10 Eurozone Retail PMI. Actual 45.8 points.
  • 8:40 Spanish 10-year Bond Auction. Actual 2.27%.
  • Tentative – French 10-year Bond Auction.
  • 11:30 US Challenger Job Cuts.
  • 11:45 ECB Minimum Bid Rate. Estimate 0.15%.
  • 12:15 US ADP Non-Farm Employment Change. Estimate 218K.
  • 12:30 ECB Press Conference.
  • 12:30 US Trade Balance. Estimate -42.5B.
  • 12:30 US Unemployment Claims. Estimate 298K.
  • 12:30 US Revised Nonfarm Productivity. Estimate 2.5%.
  • 12:30 US Revised Unit Labor Costs. Estimate 0.6%.
  • 13:45 US Final Services PMI. Estimate 58.5 points.
  • 14:00 US ISM Nonfarm Manufacturing PMI. Estimate 57.3 points.
  • 14:30 US Natural Gas Storage. Estimate 72B.
  • 15:00 US Crude Oil Inventories. Estimate -0.9M.
  • 16:30 FOMC Member Loretta Mester Speaks.
  • 23:00 FOMC Member Jerome Powell 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.