EUR/USD – Euro under pressure, U.S Advance GDP next

EUR/USD continues with its losing ways in the Friday session. Currently, the pair is trading at 1.1353, down 0.19% on the day. On the release front, the sole eurozone indicator is German GfK Consumer Climate, which remained steady at 10.6 points. This edged above the forecast of 10.5 points. In the U.S, all eyes will be Advance GDP for the third quarter, which is expected to post a strong gain of 3.3%. We’ll also get a look at consumer confidence, with UoM Consumer Sentiment expected to drop to 98.9 points.

The euro continues to struggle this week, with the currency dropping 1.3%. On Friday, the euro fell to a low of 1.1352, its lowest level since mid-August. Unless the euro has a strong comeback on Friday, this week’s decline will be one of the sharpest this year. With global stock markets spiraling lower, risk appetite has dampened as investors flock to the U.S dollar at the expense of the euro and other currencies. A rash of geopolitical hotspots has weighed on investor sentiment, including the spike in Italian debt, the Brexit impasse and the U.S-China trade war.

As expected, the ECB maintained its main refinancing rate at a flat 0.00% at its policy meeting on Thursday. ECB President Mario Draghi acknowledged that the turmoil in global markets has raised the risks to the eurozone economy, but reiterated that the ECB remained on track to wind up its asset-purchase program in December. With the euro and European stock markets heading lower this week, Draghi tried to put a positive face on recent developments. He discussed the eurozone’s “broad-based” economic growth and said he was confident that the Italian government would reach an agreement with the European Commission, which has rejected Italy’s budget since it raises the country’s deficit. However, Drahgi acknowledged that the eurozone economy has softened, and also noted the risks from the global trade war and the volatile political climate in Italy.

Moody US markets

OANDA European open – Markets dive on earnings

Equities Sea of red

EUR/USD Fundamentals

Friday (October 26)

  • 2:00 German GfK Consumer Climate. Estimate 10.5. Actual 10.6
  • 8:30 US Advance GDP. Estimate 3.3%
  • 8:30 US Advance GDP Price Index. Estimate 2.1%
  • 10:00 ECB President Draghi Speaks
  • 10:00 US Revised UoM Consumer Sentiment. Estimate 98.9

*All release times are DST

*Key events are in bold

 

EUR/USD for Friday, October 26, 2018

EUR/USD for October 26 at 5:55 DST

Open: 1.1375 High: 1.1384 Low: 1.1358 Close: 1.1353

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1120 1.1212 1.1300 1.1430 1.1553 1.1611

EUR/USD was flat in the Asian session. The pair posted small gains in European trade but has reversed directions and lost ground

  • 1.1300 is providing support
  • 1.1434 is the next resistance line
  • Current range: 1.1300 to 1.1434

Further levels in both directions:

  • Below: 1.1300, 1.1212 and 1.1120
  • Above: 1.1434, 1.1553, 1.1611 and 1.1735

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.