EUR/USD – Euro Steady at 1.24

EUR/USD is showing little movement on Wednesday, as the pair is trading in the high-1.23 range. On the release front, it’s a quiet day, with no major events out of the Eurozone or the US. In the Eurozone, French Industrial Production disappointed, posting a decline of -0.8%. In the US, today’s highlight is Crude Oil Inventories.

The Eurozone continues to struggle with low inflation levels, and a senior ECB official is warning of deflation dangers. Speaking in Washington on Tuesday, ECB board member Peter Praet said that falling oil prices could push Eurozone inflation into negative territory. Such a scenario would spell bad news for the sluggish Eurozone economy and could push the euro to lower levels.

German numbers have been mixed recently and the trend has continued this week. On Tuesday, Trade Balance climbed to EUR 20.6 billion, marking a 3-month high. This easily beat the estimate of 18.1 billion. On Monday, German Industrial Production didn’t look sharp, posting a weak gain of 0.2%. This was a sharp drop from the 1.4% gain a month earlier. As the Eurozone’s largest economy, the euro is sensitive to German data and could lose more ground if key German data misses expectations.

US employment data has rebounded in impressive fashion and the good news continued on Tuesday, as JOLTS Job Openings climbed to 4.83 million, up from 4.74 million a month earlier. This beat the estimate of 4.81 million. On Friday, Nonfarm Payrolls shot up to 321 thousand in November, stunning the markets which had expected a rise of 231 thousand. There was also a rise in wages, which should translate into stronger inflation numbers. The unemployment rate held steady at 5.8%, matching the forecast. The excellent Nonfarm Payrolls should help allay concerns about whether the economy can weather an expected rate increase in 2015.

 

EUR/USD for Wednesday, December 10, 2014

EUR/USD December 10th 10:20 GMT

EUR/USD 1.2388 H: 1.2399 L: 1.2362

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.2042 1.2143 1.2286 1.2407 1.2518 1.2688

 

  • EUR/USD has shown little movement in the Asian and European sessions.
  • 1.2407 remains a weak resistance line. 1.2518 is stronger.
  • 1.2286 is a strong support level.
  • Current range: 1.2286 to 1.2407

Further levels in both directions:

  • Below: 1.2286, 1.2143, 1.2042, 119.26 and 118.02
  • Above: 1.2407, 1.2518, 1.2688 and 1.2806

 

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in short positions on Wednesday, continuing the trend we saw a day earlier. This is not consistent with the pair’s movement, as the euro is almost unchanged. The ratio is pointing to a majority of short positions, indicative of trader towards the dollar posting gains.

EUR/USD Fundamentals

  • 6:30 French Final Nonfarm Payrolls. Estimate -0.2%. Actual -0.3%.
  • 7:45 French Industrial Production. Estimate 0.2%. Actual -0.8%.
  • 15:30 US Crude Oil Inventories. Estimate -2.6M.
  • 18:01 US 10-year Bond Auction.
  • 19:00 US Federal Budget Balance. Estimate -68.3B.

* 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.