EUR/USD – Euro under pressure as Eurozone CPI expected to dip

After posting two losing sessions, EUR/USD is steady in Thursday trading. Currently, the pair is trading at 1.1391, down 0.05% on the day. On the release front, the eurozone releases CPI, which should be treated as  a market-mover. In the U.S, we’ll get a look at unemployment claims and the Philly Fed Manufacturing Index.

With the eurozone struggling, there are plenty of headaches for ECB policymakers, and Mario Draghi shared some of his concerns on Tuesday, at a plenary session on the ECB annual report. Draghi highlighted Brexit and the U.S-China trade war as significant concerns and noted that eurozone economic conditions have been weaker than expected, adding that the eurozone was undergoing a slowdown but was not heading into recession. The ECB holds its next policy meeting on January 24, with no change in monetary policy expected.

Risk appetite has improved in January, but a weaker Chinese economy could spook investors. The global trade war has hurt the eurozone export and manufacturing sectors, and the giant Chinese economy continues to show signs of a slowdown. Earlier in the week, China released dismal economic numbers, with exports down 4.4 percent from a year earlier and imports plunging 7.6 percent. The slowdown in China has taken a toll on corporate profits and continues to be a major concern for investors and policymakers.

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EUR/USD Fundamentals

Thursday (January 17)

  • 4:00 Italian Trade Balance. Estimate 2.89B. Actual 3.84B
  • 5:00 Eurozone Final CPI. Estimate 1.7%
  • 5:00 Eurozone Final Core CPI. Estimate 1.0%
  • 8:30 US Philly Fed Manufacturing Index. Estimate 9.7
  • 8:30 US Unemployment Claims. Estimate 219K
  • 10:30 US Natural Gas Storage. Estimate -73B
  • 10:45 US FOMC Member Quarles Speaks

Friday (January 18)

  • 4:00 Eurozone Current Account. Estimate 24.1B
  • 10:00 US Preliminary UoM Consumer Sentiment. Estimate 97.0

*All release times are EST

*Key events are in bold

EUR/USD for Thursday, January 17, 2019

EUR/USD for January 17 at 4:30 EST

Open: 1.1391 High: 1.1401 Low: 1.1372 Close: 1.1396

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1120 1.1212 1.1300 1.1434 1.1553 1.1685

EUR/USD inched higher in the Asian session but then retracted. In European trade, the pair has posted small gains

  • 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, 1.1685 and 1.1803

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.