The euro has started the week with gains. Currently, EUR/USD is trading at 1.1805, up 0.20% on the day. On the release front, German Ifo Business Climate dipped to 117.2, short of the forecast of 117.6 points. In the US, today’s key event is Building Permits, which is expected to slow to 1.25 million. We’ll also get a look at Current Account and Housing Starts. On Wednesday, Germany releases PPI and the US publishes Existing Home Sales.
Germany’s political landscape remains unclear, as coalition talks continue at a snail’s pace. President Angela Merkel’s conservative bloc suffered losses in the September election, and talks with smaller parties proved fruitless. Merkel has now shifted her efforts at her previous junior coalition party, the Social Democrats (SDP). On Friday, the SDP voted to begin exploratory talks with Merkel, with a view to discussing substantive issues in January. Many SDP lawmakers want a more senior role for the SDP in any coalition, and the SDP will likely demand key portfolios in a new government. Despite the political uncertainty, the German economy continues to look very strong.
President Trump’s tax reform bill appears ready to sprint across the finish line, thanks to feverish efforts by Republican lawmakers in recent weeks. After the House and Senate reconciled their versions of the tax bills, the Republicans hammered out the sticking points and reconciled the bills. The uniform legislation is expected to be voted on in the House on Tuesday and the Senate on Wednesday. With Democrats in both branches opposing the bill, the Republicans will need every vote in the Senate, where they have a thin 59-41 majority. Several Republican senators who were undecided have said they will vote in favor, so the bill is likely to pass through Congress and will then be signed into law by President Trump. This marks the first major overhaul of the US tax code in 30 years, and would represent a huge victory for Trump, ahead of Congressional elections in 2018.
Tuesday (December 19)
- 4:00 German Ifo Business Climate. Estimate 117.6. Actual 117.2
- 8:30 US Building Permits. Estimate 1.27M
- 8:30 US Current Account. Estimate -116B
- 8:30 US Housing Starts. Estimate 1.25M
- Tentative – US FOMC Member Neel Kashkari Speaks
Wednesday (December 20)
- 2:00 German PPI. Estimate 0.2%
- 4:00 Eurozone Current Account. Estimate 33.4B
- 8:00 German Buba President Jens Weidmann Speaks
- 10:00 US Existing Home Sales. Estimate 5.53M
*All release times are GMT
*Key events are in bold
EUR/USD for Tuesday, December 19, 2017
EUR/USD for December 19 at 4:45 EDT
Open: 1.1782 High: 1.1819 Low: 1.1776 Close: 1.1805
EUR/USD ticked higher in the Asian session. The pair is showing limited movement in the European session
- 1.1777 was tested earlier in support. It remains a weak line
- 1.1876 is the next resistance line
Further levels in both directions:
- Below: 1.1777, 1.1657, 1.1574 and 1.1434
- Above: 1.1876, 1.1961 and 1.2092
- Current range: 1.1777 to 1.1876
OANDA’s Open Positions Ratio
EUR/USD is unchanged this week. Currently, short positions have a majority (56%), indicative of EUR/USD reversing directions and moving downwards.
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.