EUR/USD – Euro Under Pressure As German Economic Sentiment Eyed

The euro German ZEW Economic Sentiment, a key event. In the US, Empire State Manufacturing Index jumped to 27.5 points, well above expectations. Eurozone ZEW Economic Sentiment.      In the US, today’s highlight is the Producer Price Index, the first major US release of the week. The markets are not expecting any change from the previous release, with an estimate of 0.1%.

US numbers wrapped up last week on a high note. Core Retail Sales improved to 0.3%, edging above the estimate of 0.2%. Retail Sales posted a nice gain of 0.6%, well above the estimate of 0.3%. There was excellent news from the UoM Consumer Sentiment, which bounced back from a weak reading in July and improved to 84.6 points, its best showing since November 2012. The forecast stood at 83.2 points. These indicators point to an increase in consumer confidence and spending, which underscore a deepening economic recovery.

US employment numbers continue to be a source of concern. Last week, Unemployment Claims rose to 315 thousand, the largest number of claims in 10 weeks. The reading was much higher than the estimate of 306 thousand. This follows soft numbers from JOLTS Job Openings and a dismal Nonfarm Payrolls earlier in the month. The troubling job numbers are unlikely to affect the Fed’s plan to continue trimming QE later this week, but a soft labor market could postpone plans to raise interest rates by mid-2015.

 

EUR/USD for Monday, September 15, 2014

EUR/USD September 15 at 12:20 GMT

EUR/USD 1.2915  H: 1.2969 L: 1.2909

 

EUR/USD Technical

S3 S2 S1 R1 R2 R3
1.2688 1.2806 1.2905 1.2984 1.3104 1.3175

 

  • EUR/USD moved lower late in the European session and this trend has continued in the European session.
  • On the downside, 1.2905 is under strong pressure and could break during the day. 1.2806 is stronger.
  • 1.2984 is the next resistance line. 1.3104 is next.
  • Current range: 1.2905 to 1.2984

Further levels in both directions:

  • Below: 1.2905, 1.2806, 1.2688 and 1.2518
  • Above: 1.2984, 1.3104, 1.3175 and 1.3288

 

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in short positions on Monday. This is consistent with the movement of the pair, which has posted losses. The ratio has a majority of long positions, indicative of a trader bias towards the euro reversing directions and moving upwards.

 

EUR/USD Fundamentals

  • 9:00 Eurozone Trade Balance. Estimate 15.9B. Actual 12.2B.
  • 12:30 US Empire State Manufacturing Index. Estimate 16.4 points. Actual 27.5 points.
  • 13:15 US Capacity Utilization Rate. Estimate 79.3%.
  • 13:15 US Industrial Production. Estimate 0.4%.

*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.