EUR/USD – Euro creeps up to 2-week high

EUR/USD is steady in Tuesday trade. Currently, the pair is trading at 1.1356, up 0.15% on the day. On Monday, the pair climbed to a 2-week high, as the positive momentum continues. On the fundamental calendar, German ZEW Economic Sentiment remained in negative territory, but improved to -3.6 points. This easily beat the estimate of -11.0 points. The eurozone event showed a similar trend, improving to -2.5 points. This beat the forecast and was the highest reading since May. For a second straight day, there are no major U.S. events. On Tuesday, Germany releases PPI and the Federal Reserve issues its monthly rate statement.

The Federal Reserve holds its monthly meeting on Wednesday, and is virtually certain to hold the benchmark rate at a range between 2.25 – 2.50 percent. The Fed has been sending a dovish message to the markets, and this stance is expected to continue in the March rate statement. The Fed’s balance sheet will also be under scrutiny, with the policymakers expected to announce when they will stop reducing the $4 billion balance sheet. The Fed has been reducing assets by $50 billion a month, but there has been criticism that this tightening is choking economic growth. The Fed will also publish its new dot plot, which is used to convey its interest rate outlook.

The ECB is also in a dovish mode, as the economic slowdown continues to weigh on the eurozone. Inflation climbed slightly in February to 1.5% year-on-year, but remains well below the ECB target of 2 percent. Low inflation means there is no pressure on the bank to raise rates in the near future. At the March policy meeting, policymakers delayed a rate hike to 2020 at the earliest, and this sent the euro to lower levels. The bank also cut its inflation forecast for 2019 to 1.2%, down from the previous forecast of 1.6%.

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EUR/USD Fundamentals

Tuesday (March 19)

  • 5:00 Italian Trade Balance. Estimate 3.45B
  • 6:00 German ZEW Economic Sentiment. Estimate -11.0. Actual -3.6
  • 6:00 Eurozone ZEW Economic Sentiment. Estimate -15.1. Actual -2.5
  • 10:00 US Factory Orders. Estimate 0.3%

Wednesday (March 20)

  • 3:00 German PPI. Estimate 0.2%
  • 14:00 US FOMC Economic Projections
  • 14:00 US FOMC Statement
  • 14:00 US Federal Funds Rate. Estimate <2.50%
  • 14:00 US FOMC Press Conference

*All release times are DST

*Key events are in bold

EUR/USD for Tuesday, March 19, 2019

EUR/USD for March 19 at 7:00 DST

Open: 1.1340 High: 1.1357 Low: 1.1334 Close: 1.1356

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1120 1.1212 1.1300 1.1434 1.1553 1.1610

EUR/USD posted small gains in Asian trade and the trend continues in the European session

  • 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, 1.1120 and 1.1046
  • Above: 1.1434, 1.1553 and 1.1610

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.