Week in FX Europe – EUR Strength, Nope, Dollar Weakness

The 17-member single currency is ending the week confined within a now well-established trading range. A brief post Friday lunch scurry higher failed in its attempt to break through key resistance levels (1.3560-70), and this even after various options expiries helping.

The EUR bulls have become deflated by Italy’s precarious political situation and on rumors that the country itself may soon be downgraded. After encroaching and failing to penetrate its highs, the single currency easily cleared its short-term support on an announcement that Italy is willing to delay its October sales tax hike until next January. The market concerns of Italian debt growing more have the EUR reversing some of Fridays early rally.

If the currency happens to trade through and remains below the 1.3500 handles for a period of time, will certainly open up the possibility of a technical attack on the previous days lows. There are currently a plethora of stops losses beginning to build below the strong support level sub-1.3450. As to be expected, month and quarter end demand usually plays havoc with volatility and the technicals, which tend to dissuade many investors from competing.


* EUR Euro-Zone Consumer Price Index
* CAD Gross Domestic Product
* CNY Manufacturing PMI
* AUD Reserve Bank of Australia Rate Decision
* EUR German Unemployment Change
* USD ISM Manufacturing
* EUR European Central Bank Rate Decision
* USD ISM Non-Manufacturing Composite
* JPY Bank of Japan Rate Decision
* USD Unemployment Rate
* USD Change in Non-farm Payrolls

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.

Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell