EUR/USD – Euro Stable Ahead of Fed Statement

EUR/USD is calm on Wednesday, as the pair trades in the mid-1.26 line in the European session. The euro has had a good week, adding about 150 points. On the release front, it’s a quiet day, with no Eurozone releases. In the US, today’s highlight is the minutes of the FOMC’s most recent policy meeting. Traders should treat this event as a market-mover.

It’s been a rough week for German numbers, as the Eurozone’s locomotive is having trouble. Industrial Production declined by 4.0% last month, its sharpest drop since January 2009. This was well off the estimate of -1.4%. German Factory Orders had an awful September, coming in at -5.7%. This was the indicator’s third decline in four releases. German Trade Balance will be released on Thursday, with the markets expecting a drop in the trade surplus. If German data does not show improvement, the euro will have a tough task holding its own against the strong US dollar.

US job numbers continue to impress. On Tuesday, JOLTS Job Openings climbed to 4.84 million, up from  4.67 million a month earlier. The indicator is on a strong upward trend, indicative of the US employment sector. Last week, Nonfarm Employment change rebounded in September, climbing to 248 thousand. This exceeded expectations of 216 thousand. The unemployment rate dipped to 5.9%, the first time it’s been below the 6% threshold in over six years. With QE slated to end later this month, the focus will shift to the timetable for an interest rake hike. Strong employment numbers such as these could put pressure on the Fed to make an interest rate move sooner rather than later in 2015, and increased speculation about a rate move will likely boost the dollar even further.

EUR/USD for Wednesday, October 8, 2014

EUR/USD October 8 at 9:45 GMT

EUR/USD 1.2559 H: 1.2583 L: 1.2523

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.2286 1.2407 1.2518 1.2688 1.2806 1.2905

 

  • EUR/USD has been marked by choppy trading in the Asian and European sessions.
  • 1.2518 is an immediate support line. 1.2407 is stronger.
  • 1.2688 is a strong resistance line.
  • Current range: 1.2518 to 1.2688

Further levels in both directions:

  • Below: 1.2518, 1.2407, 1.2286 and 1.2144
  • Above: 1.2688, 1.2806, 1.2905, 1.2984 and 1.3104

 

OANDA’s Open Positions Ratio

EUR/USD ratio is unchanged on Wednesday. This is consistent with the lack of movement we’re seeing from the pair. The ratio is almost evenly split, indicative of a lack of trader bias as to which direction the pair will take.

 

EUR/USD Fundamentals

  • 14:30 US Crude Oil Inventories. Estimate 2.1M.
  • 17:01 US 10-year  Bond Auction.
  • 18:00 US FOMC Meeting Minutes.

* 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.