EUR/USD – Euro Shrugs Off Stellar German Retail Sales

EUR/USD is almost unchanged in the Wednesday session, as the pair trades at 1.0640. On the release schedule, German Retail Sales posted a gain of 2.4%, well above the forecast of 1.0%. The Eurozone CPI Flash Estimate is expected to edge up to 0.6%. The US will release ADP Nonfarm Employment Change, with the markets predicting an improvement of 161 thousand. As well, OPEC members will meet in Vienna, hoping to reach an agreement to cap oil production.

In an attempt to raise anemic inflation levels, the ECB  lowered interest rates to 0.00% in March. Still, the inflation target of 2.0% remains elusive. On Tuesday, German Preliminary CPI dipped to 0.1% in November, down from 0.2% a month earlier. However, Eurozone CPI Flash Estimate has been moving upwards and is expected to improve to 0.6% in November. The ECB will meet for a policy meeting next week and is likely to maintain current rate levels. On Monday,  ECB President Mario Draghi addressed an ECB parliamentary committee. Draghi said that the Eurozone growth had been “moderate but steady” despite the effects of global economic and political uncertainty. Draghi also said that he expected the economy’s recovery to continue.

It was a banner day for US numbers on Tuesday, as GDP and consumer confidence data pointed upwards. Preliminary GDP sparkled in the third quarter, as the economy expanded 3.2%, above the forecast of 3.0%. The 3.2% gain was an upwards revision of Advance GDP, which came in at 2.9%. Solid consumer confidence numbers have been a critical factor in the US recovery, as an optimistic consumer is likely to go out and spend money. CB Consumer Confidence jumped to 107.1 points in November, surpassing the 100-level for the third time in four months. Last week, UoM Consumer Sentiment jumped to 93.8 points, its highest level since May. Donald Trump’s surprise election victory has not had an adverse effect on consumer confidence, and if these rosy numbers translate into stronger consumer spending, the US dollar could continue to climb against its rivals.

US Q3 GDP Revised Upward on Consumer Spending

OPEC Deal Uncertain as Ministers Meet in Vienna

EUR/USD Fundamentals

Wednesday (November 29)

  • 7:00 German Retail Sales. Estimate 1.0%. Actual 2.4%
  • 7:45 French Preliminary CPI. Estimate -0.1%. Actual 0.0%
  • 8:55 German Employment Change. Estimate -6K. Actual -5K
  • All Day – OPEC Meetings
  • 10:00 Eurozone CPI Flash Estimate. Estimate 0.6%
  • 10:00 Eurozone Core CPI Flash Estimate. Estimate 0.8%
  • 10:00 Italian Preliminary CPI. Estimate -0.2%
  • 12:30 ECB President Mario Draghi Speech
  • 13:15 US ADP Nonfarm Employment Change. Estimate 161K
  • 13:30 US Core PCE Price Index. Estimate 0.1%
  • 13:30 US Personal Spending. Estimate 0.5%
  • 13:30 US Personal Income. Estimate 0.4%
  • 14:45 US Chicago PMI. Estimate 52.1
  • 15:00 US Pending Home Sales. Estimate 0.3%
  • 15:30 US Crude Oil Inventories. Estimate 0.7M
  • 16:00 German Buba President Jens Weidmann Speech
  • 16:45 US FOMC Member Jerome Powell Speech
  • 19:00 US Beige Book

*All release times are GMT

* Key events are in bold

EUR/USD for Wednesday, November 30, 2016

EUR/USD November 30 at 11:20 GMT

Open: 1.0647 High: 1.0664 Low: 1.0619 Close: 1.0652

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.0414 1.0506 1.0616 1.0708 1.0821 1.0957
  • EUR/USD posted slight losses in the Asian session but has recovered in European trade
  • 1.0616 is a weak support line
  • There is resistance at 1.0708

Further levels in both directions:

  • Below: 1.0616, 1.0506, 1.0414 and 1.0287
  • Above: 1.0708, 1.0821 and 1.0957
  • Current range: 1.0616 to 1.0708

OANDA’s Open Positions Ratio

EUR/USD ratio remains unchanged this week. Currently, short positions have a majority (65%), indicative of trader bias towards EUR/USD breaking out and moving lower.

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.