EUR/USD – Little Movement As German Retail Sales Climbs

EUR/USD is showing little movement on Friday, as the pair trades in the mid-1.24 range. On the release front, German Retail Sales posted a strong gain of 1.9%, beating the estimate. French Consumer Spending declined by 0.9%, well short of the estimate of a 0.2% gain. Italian Monthly Unemployment was unexpectedly high, coming in at 13.2%. Later in the day, we’ll get a look at Eurozone CPI, a key event which could have a strong impact on EUR/USD. There are no US releases on Friday.

It’s been a good week for releases out of Germany, the Eurozone locomotive. The week wrapped up with Retail Sales, which bounced back with a strong gain of 1.9%, ahead of the estimate of 1.7%. On Thursday, Unemployment Change came in at 14 thousand, much stronger than the estimate of -1K. As well, German CPI improved to 0.0% in November, matching the forecast. The business sector remains confident in the economy, as Ifo Business Climate climbed higher in November. Strong German numbers are crucial to boosting the ailing Eurozone economy, which remains hampered by weak growth and inflation levels, as well as high unemployment.

Ahead of the Thanksgiving holiday, the US released a batch of data on Wednesday and the numbers were anything but impressive. Unemployment Claims jumped to 313 thousand, its highest level since mid-September. Core Durable Goods Orders declined 0.9%, its third decline in four readings. The estimate stood at 0.5%. New Home Sales fell to a 3-month low, dropping to 458 thousand. This was short of the estimate of 471 thousand. Pending Home Sales was no better, declining by 1.1%, well off the estimate of 0.9%. There was better news from UoM Consumer Sentiment, which posted a fourth straight gain, rising to 88.8 points. However, this was short of the estimate of 90.2 points. Despite the weak numbers, market sentiment towards the US economy remains high, and the US dollar was able to hold its own against the euro.

EUR/USD for Friday, November 28, 2014

EUR/USD November 28 9:35 GMT

EUR/USD 1.2439 H: 1.2465 L: 1.2429

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.2143 1.2286 1.2407 1.2518 1.2688 1.2806

 

  • EUR/USD has shown limited movement in the Asian and European sessions.
  • 1.2518 is the next resistance line.
  • 1.2407 is a weak support level. Will the pair break below this line? 1.2286 is stronger.
  • 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 1.2995

 

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in long positions on Friday, reversing the direction seen a day earlier. This is not consistent with the pair’s movement, as the euro has posted small losses. The pair has a majority of short positions, indicative of trader bias towards the dollar moving higher.

EUR/USD Fundamentals

  • 7::00 German Retail Sales. Estimate 1.7%. Actual 1.9%.
  • 7:45 Eurozone French Consumer Spending. Estimate 0.2%. Actual -0.9%.
  • 9:00 Italian Monthly Unemployment Rate. Estimate 12.6%.
  • 9:00 Italian Quarterly Unemployment Rate. Estimate 12.4%.
  • 10:00 Eurozone CPI Flash Estimate. Estimate 0.3%.
  • 10:00 Eurozone Core CPI Flash Estimate. Estimate 0.7%.
  • 10:00 Eurozone Unemployment Rate. Estimate 11.5%.
  • 10:00 Italian Preliminary CPI. Estimate -0.3%.

* 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.