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EUR/USD – Euro shrugs off dismal German ZEW Economic Sentiment

EUR/USD is steady in the Tuesday session, after posting slight gains to start the week. Currently, the pair is trading at 1.1579, unchanged on the day. On the release front, German ZEW Economic Sentiment plunged to a level of -24.7, well below the estimate of -12.3 points. Eurozone ZEW Economic Sentiment followed a similar trend, falling to -19.4, compared to a forecast of -9.2 points. In the U.S, JOLTS Job Openings is expected to dip to 6.90 million. The markets are still waiting for the U.S Treasury to release its semi-annual currency report, which may occur later on Tuesday. The U.S will release Building Permits and Housing Starts, and the Federal Reserve will publish its minutes from the September policy meeting.

Confidence in the German economy continues to sputter, as German ZEW Economic Sentiment dropped sharply to -24.7 in October, after a reading of -10.6 a month earlier. The ZEW assessment noted that there is increased pessimism over the German economy due to the escalating trade war between China and the United States. A second factor is worries over Brexit, with fears that the U.K will depart from the EU without an agreement in place. Both issues have dampened export expectations. The indicator finds itself in negative territory for a seventh straight month. Investor sentiment in the eurozone economy also is weak, with the ZEW Economic Sentiment dropping to -19.4, its lowest level since August 2012.

EU leaders are meeting in Brussels, and officials had hoped that the summit would include a draft statement on Brexit, but this plan has been shelved due to a deadlock over the Irish border. The EU is insisting that it will not sign a withdrawal agreement with Britain, unless there is a backstop which allows Northern Ireland to remain in a customs union with the EU after Brexit. However, the British government is unlikely to agree to such a move, since it would require regulatory barriers within the United Kingdom. With plans for a Brexit statement at Wednesday’s meeting on hold, a Brexit statement with have to wait until EU leaders meet in November or even December, which is extremely close to the Brexit deadline in March 2019.

Asia Market update : A time out [1]

Risk remains on the back foot [2]

EUR/USD Fundamentals

Tuesday (October 16)

Wednesday (October 17)

*All release times are DST

*Key events are in bold

EUR/USD for Tuesday, October 16, 2018

EUR/USD for October 16 at 7:00 DST

Open: 1.1579 High: 1.1599 Low: 1.1566 Close: 1.1579

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1300 1.1434 1.1553 1.1611 1.1735 1.1840

EUR/USD ticked lower in the Asian session. In European trade, the pair posted small gains but has retracted

Further levels in both directions:

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 [6]

Market Analyst at OANDA [7]
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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