EUR/USD has posted losses on Wednesday, wiping out the gains seen a day earlier. In the European session, the pair is trading in the high-1.24 range in the European session. In the Eurozone, Services PMIs met expectations, but Retail Sales looked awful, posting a sharp decline of -1.3%. In the US, there are two major events – ADP Non-Farm Employment Change and US ISM Non-Manufacturing PMI.
Eurozone and Spanish Services PMI were almost unchanged from last month and met expectations. The Italian release improved to 50.8, pointing to expansion in the services industry for the first time in three months. The news was not as positive from Retail Sales, which came in at -1.3%, much worse than the estimate of -0.6%. This marked the indicator’s sharpest decline since January. Consumer spending is a key component of economic growth, and is one more indication of the poor state of the Eurozone economy.
The US economy continues to improve and job data have looked solid of late. We’ll get a look at key employment releases, starting with the ADP Non-Farm Employment Change on Wednesday. The markets are expecting a reading of 214 thousand, almost unchanged from last month’s figure of 213 thousand. Will the indicator beat expectations for a second straight month?
The EU released its Economic Forecasts on Tuesday, which provides an economic projection for Eurozone members for the next two years. EU Vice President Jyrki Katainen said that the economic and employment situation is “not improving fast enough” in the zone, which continues to struggle with very weak growth and high unemployment. The EU noted that growth is expected to reach just 0.8%, growth this year, and heavyweights Germany and France are expected to post weak growth for 2014.
EUR/USD for Wednesday, November 5, 2014
EUR/USD November 5 10:20 GMT
EUR/USD 1.2488 H: 1.2567 L: 1.2475
- EUR/USD lost ground late in the Asian session and this trend continues in European trade.
- 1.2518 continues to be active and is a weak resistance line. 1.2688 is stronger.
- 1.2407 is the next support level.
- Current range: 1.2407 to 1.2518
Further levels in both directions:
- Below: 1.2407, 1.2286, 1.2143 and 1.2042
- Above: 1.2518, 1.2688, 1.2806, 1.2905 and 1.2984
OANDA’s Open Positions Ratio
EUR/USD ratio is unchanged on Wednesday. This is not consistent with the pair’s movement, as the euro has lost ground. The ratio has a majority of long positions, indicative of trader bias towards the euro reversing direction and moving higher.
- 8:15 Spanish Services PMI. Estimate 56.2 points. Actual 55.9 points.
- 8:45 Italian Services PMI. Estimate 49.6 points. Actual 50.8 points.
- 9:00 Eurozone Final Services PMI. Estimate 52.4 points. Actual 52.3 points.
- 10:00 Eurozone Retail Sales. Estimate -0.6%. Actual -1.3%.
- 13:15 US ADP Non-Farm Employment Change. Estimate 214K.
- 14:15 US FOMC Member Narayana Kocherlakota Speaks.
- 14:45 US Final Services PMI. Estimate 57.3 points.
- 15:00 US ISM Non-Manufacturing PMI. Estimate 58.2 points.
- 15:30 US Crude Oil Inventories. Estimate 1.8M.
*Key releases are highlighted in bold.