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EUR/USD – Euro Edges Higher, US Jobless Claims Next

It continues to be a quiet trading week as we wrap up 2016. Currently, EUR/USD is trading at 1.0450. The markets are likely to remain listless for the remainder of the week, with the markets characterized by thin trading volumes. It’s also a quiet day on the release front. There are no major European releases on the schedule. In the US, today’s highlight is unemployment claims, with the indicator expected to edge up to 277 thousand.

Looking back at 2016, economic growth in the Eurozone was soft but steady. The third estimate for third quarter GDP was 0.3%, identical to the second quarter expansion. This was not as strong as the first quarter growth of 0.5%. The domestic economy was marked by slow but steady growth, as the Eurozone managed to withstand this year’s political earthquakes, notably the British vote to leave the European Union and the stunning electoral victory of Donald Trump in the US. GDP growth for 2016 is expected at 1.6%, while the forecast for both 2017 and 2018 stands at 1.5%.

With the US economy continuing to expand sharply, US consumers are brimming with confidence, in what analysts are describing as a post-election surge in optimism. Recent consumer confidence surveys are pointing upwards, as the US consumer is optimistic that economic conditions will continue to improve under the incoming Trump administration. The CB Consumer Confidence report surged in December to 113.7, its highest level since August 2001. This reading comes on the heels of UoM Consumer Sentiment, which climbed to a 12-year high, with a reading of 93.8 points. Both of these well-respected surveys found that consumers are confident that continuing economic growth will create new jobs and raise incomes. Trump’s economic platform remains short on details, but he has promised to cut taxes while increasing public spending. If Trump manages to implement both of these goals, the US economy could heat up and also help global growth pick up speed.

EUR/USD Fundamentals

Thursday (December 29)

*All release times are GMT

* Key events are in bold

EUR/USD for Thursday, December 29, 2016

EUR/USD December 29 at 9:30 GMT

Open: 1.0414 High: 1.0465 Low: 1.0412 Close: 1.0453

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.0170 1.0287 1.0414 1.0506 1.0616 1.0708

Further levels in both directions:

OANDA’s Open Positions Ratio

EUR/USD ratio continues to show limited movement this week. Currently, long positions have a majority (53%), indicative of trader bias towards EUR/USD continuing its upward movement.

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 [4]

Market Analyst at OANDA [5]
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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