Daily Market Analysis from ForexMart

EUR/USD Fundamental Analysis: February 1, 2019



The euro major pair is consolidating close to the previous low during trading session amid high-risk appetite in the broad market which limited the decline to 1.14, which has been steady support across the week. News on trade deal being extended despite optimism on progress and major concerns taking straight on, in turn, these supported the dollar bulls. Another news is the possibility for two leaders of US and China are likely to meet this month with positive expectation on the trade deal, however, tariff imposition is also to be discussed if a deal wasn’t successful by March 1st.

Consequently, this shook the market as the trade talk between the EU and the US is scheduled next month to gain agreement from EU should the talk failed. The possibility of the US imposing tariffs on EU is giving a dovish tone for the common currency in the broad market. However, the EUR/USD is likely to decline in the coming month amid the dovish outlook for short and medium-term and lack of fundamental support to maintain the recent high of the euro.

The euro pair is presumed to resume its consolidation ahead of the Eurozone preliminary CPI data and German manufacturing PMI data. However, a negative result on the macro-European data would drive further decline of the pair. A positive outcome would shift the lead to the dollar bulls and opens the chance for a rally and set for consolidation in the intermediate support in the first week of February.

EUR/USD Fundamental Analysis: February 4, 2019



The euro major pair movement was driven by fundamental data, bringing a mixed price reaction. After a very active month, February began with optimism on trading the EUR/USD pair. Yet, it was not able to surpass the high levels with not so good bounce on price action. Moreover, the positive data that restricted the price movement due to the mixed reaction as mentioned. However, bulls doesn’t have enough strength to sustain the present positive flow of the trend amid the dovish sentiment this month, restricting gains slightly lower than 1.15. Moreover, both the data of US NFP data and ISM manufacturing data supported the US dollar lead the market, removing the gains acquired earlier.

As the trading session opened this week, the US dollar had taken the upper hand in the broad market and consolidated close to the intraday lows. Nevertheless, the pair is anticipated to trade within the range since both currencies lack enough momentum to succeed with a breakout. Thinking about the factors such as the headlines and events positioned the bears and bulls at same stance. In the meantime, the price movement in Asian markets are closed for today that impacted the volatility and price movement in the market. There is no scheduled major economic news from the eurozone while in the US, there is the release of data on Factory orders but will probably not have a big impact on the trading movement.

EUR/USD Fundamental Analysis: February 6, 2019



The euro major pair had a steep drop during yesterday’s trading as the US dollar took the lead in the broad market for the fourth straight days. And yet, the pair was able to move downward with the recent price rally of the pair boosted by the weakened dollar in the market instead of the euro’s strengthening. This occurs in the background of bearish tone due to dovish Fed statements and mixed macro data in the US market. At the same time, the euro is struggling as investors stand heedful with concerns on the economic sluggish growth due to below expectations macroeconomic data in the eurozone. The successful breakout of the dollar was driven by good risk appetite in the broad market, as well as the not so good macro data results.

The macro data also restricted movement in the early American hours while there is an insufficient drive for the euro to maintain its growth with the recent highs. Added to the strengthening of the dollar, it supported a steady downward movement and exceeded multiple significant support levels during the Asian trading session. Continuing on, the pair dropped below 1.14 in the background of the thin market during the holidays and less volatility and trading volume that hindered the market for a breakthrough in the support area.

For today, investors are waiting for the release of macroeconomic data and resulted to a bearish breakout. On the European calendar, the pair remains subdued for the day except for the release of the German manufacturing orders. On the other end, there is the release of building permits, core retail sales, core durable goods orders, and Preliminary GDP data qoq in the US. A positive outcome of these US macro data induces the pair to overcome the critical support level of 1.1390 that opens further decline of the pair towards the middle of 1.12. Yet, this would support the euro to gain higher than 1.14 given the negative US data but this may not be easy with the greenback growing steadfastly in the broad market for the fifth straight day.

EUR/USD Fundamental Analysis: February 7, 2019



The euro major pair is moving in a steady decline following a bearish breakthrough during the US session. Yesterday, it closed on optimistically for the fifth straight session after it struggled in the morning when Donald Trump gave his speech, giving a chance for investors to divert from risks. At the same time, with a pessimistic fundamental data surrounding the euro and positive macro data from the US supported the dollar for a bearish breakout. Consequently, the pair had a sharp decline prior to consolidation around the middle of 1.13 during the early Asian hours. Fed may have a dovish sentiment on its rate hike but the US dollar sustained its positive position in the market as investors and analysts assume the Fed to proceed with the rate hike this year.

Moreover, a good fundamental data surrounding the US Treasury bond yields support the dollar bulls since the beginning of this week’s trading and hovered higher than 1.362, increasing by 0.06% on the day. With the Asian session traders returning the market after the holidays, the trading volume, as well as volatility are expected to increase significantly. Furthermore, the investors are hoping for good macro data and open opportunities for short-term profit.

In the US, the Initial Jobless Claims data is anticipated while in the EU, several reports are to be released including the EU Economic forecast, German Industrial Production, and trade balance data, and ECB Economic Bulletin. Positive results will spur the euro and likely to sustain its consolidative rate but a negative outcome will further bring the price down towards 1.12.

On the technical aspect, there will be less resistance below as it moves smoothly below the 20-, 50- and 100-MA in daily and hourly intraday charts. As for the indicators, both RSI and stochastic signal lines are directed towards the oversold area in the hourly chart while it is still below the oversold area in the 4-hour and daily charts, which means that there is a high chance for the decline of the pair to continue for the day.

EUR/USD Fundamental Analysis: February 8, 2019



After four succeeding bearish trading, the euro major pair finally gained some momentum towards the end of the week. However, the euro bulls have limited the downward movement and close optimistically for the week. The week began with the US dollar taking the lead amid the thin trading during the holidays affecting market volatility, volume and risk appetite in the majority of the Asian session. Furthermore, below expectations released macro data in the euro zone escalated concerns in the market as investors worry on the tendency of a slowdown in the euro area economic activity amid the Brexit negotiations. In turn, these factors give a bearish sentiment to the common currency. At the same time, this supports the dollar’s attempt for a bearish breakout.

With its decline for a week, the release of macro data from the US hinders the dollar bulls to continue with its further decline. There is no enough momentum for recovery for the dollar bulls given the pessimistic unemployment data while the bulls are in a calm state in the broad market. Yet, the euro cannot take advantage of the upward momentum amid the lack of major economic data to support a price rally. Hence, this results in range-bound trading after intraday lows close to the middle of 1.35, which will likely persist throughout the day since there is minimal chance for a breakout with no fundamental data to support this.

Meanwhile, minor reports are anticipated to come out from the EU and the United States. The German trade balance data and preliminary French Q4 NFP data are anticipated to come out from eurozone while the WASDE report and U.S. Baker Hughes oil rig count data are scheduled to be released from the US.

On a technical aspect, it seems that it lacks the strength to determine the direction as it stays close to recent lows.

USD/JPY Technical Analysis: February 22, 2019



The dollar against the Japanese yen is trading slightly higher on Friday amid a relatively low volume. For the sixth trading day, volatility stays below the average after below expectations outcome of the US economic data. Various data including Durable Goods, Core Durable Goods, the Philadelphia Fed Manufacturing Index, Flash Manufacturing PMI and Existing Home Sales are less than expected outcome which settles the Fed concerns over this economic struggle ahead.

Looking at the early price action, the USD/JPY pair will probably trade for short-term at 110.693. If the price stays above 110.693, it will signify the presence of buyers. The initial target of the week’s high at 110.950. Breaking this level would induce an upward growth to change that closing top price reversal of 111.130.

On the other hand, if the price stays below the level of 110.693, it will indicate the presence of sellers. The primary target will be the main Fibonacci level of 110.452. Crossing to the weak side would mean a stronger drive for momentum with the lower limit at 110.255 as the next goal.

EUR/USD Fundamental Analysis: March 11, 2019



The euro is trading higher on Monday for a while prior to the opening of the US session, driven by the reaction of the market to oversold induced by a steep decline last week. The dovish signals from the ECB last week affect the long-term price movement, hence, we can conclude that the rally will not last for a long time.

It is likely that we are also looking for price parity after the results of a mixed US employment has come out. This implies that the US economy is presently weakening. However, after the recent stimulus program of the ECB, it may mean that the eurozone is on the weaker side of the two nations.

We can expect for low volatility after the release of the US sales report at 12.30 GMT especially if this turns out less than the forecast. The core retail sales report is anticipated to increase by 0.4% while retail sales are likely to come out flat.

According to the daily chart, the price trend is moving downward and if it reaches the level of 1.1176, the downtrend will likely continue. The initial target is the Gann angle at 1.1560 in consideration of the price action at the beginning with upward momentum. Overcoming this angle would mean the short-partaking is getting stronger and could lead to a rally towards the 50% level of 1.1298.

The short-range is presumed to be at 1.1420 and 1.1176 with the retracement zoner at 1.1298 and 1.1327 as the initial upward target. Meanwhile, sellers are likely to test the area given that the main trend is downward. However, if the current intraday fails to exceed today's’ intraday high of 1.1247, then we can assume the possibility of a short-term pullback to a short-term pivot of 1.1213.

EUR/USD Fundamental Analysis: March 13, 2019



Yesterday’s trading of the EUR/USD pair began in a subdued manner for this week. Meanwhile the price moved upward during the Asian and early European session which limited the gains of investors prior to the UK parliament meeting and limits having any major bets. Even after the release of the a mix macro data from the European calendar, the impact was not that prominent on the price movement but a strong resistance was encountered close to the level of 1.127, which then rallied and traded range-bound. This was supported by the mixed macro data which then weakened the greenback. Soon after, the us dollar gained momentum and strengthened in the late European hours after the release of optimistic US macro data.

The European calendar remains calm from the release of non-farm payroll in France in the fourth quarter while in US session, there is the release of the core CPI update and speech from FOMC member Brainard prior of UK parliament’s vote on Brexit deal. Both of the French and US macro data are unlikely to have a strong impact on the price movement with a neutral forecast or unchanged data. On a technical aspect, a breakout would determine the price direction which will likely be the main reason in short- and long-term outlook. Moreover, with the May deal and widening spread between German and American 10-year bonds will probably favor the US dollar.

EUR/USD Fundamental Analysis: March 15, 2019



The euro major pair moved in a two-way price movement driven by investor sentiment because of headlines. There is high-risk appetite throughout the day which supported the euro to move in a positive price action early in the day. However, news of a delay in meeting between the Chinese and US presidents to sign a trade deal later this month to April which influenced the investor sentiment to be cautious in the late European market hours. In turn, the EUR/USD pair dropped slightly but attention is still focused on the UK parliament vote to extend the article 50 deadline and price in the majority of global traders.

Investors wait for the release of the macro data to get some hints on the trading session which is about to close for the week. On the fundamental reports, data on Italian CPI & HICP and Euro area CPI data from the EU calendar are expected while report on Industrial production data, JOLTs Job Openings, Michigan Consumer sentiment, and Michigan Consumer expectation from the US are scheduled to be published.

On the technical aspect, there is less resistance on the upper side of the channel if Brexit continued in front of the UK parliament and high-risk appetite in the broad market.

EUR/USD Fundamental Analysis: March 25, 2019



This week starts with a fresh new high for the euro major pair. However, all of the gains were erased after the release of a weakened European PMI, particularly from the German and Eurozone. The results were not expected by investors. Moreover, will the presence of uncertainty, there was an increase in selling bias for the currency, which resulted to a downward rally which was mainly due to the weakened manufacturing added to the concerns on US-China trade war in the background of Brexit negotiation that affects the overall imports and exports of the nation. Uncertainty will probably resume during the week.

With the big drop of the EUR/USD pair on Thursday, the price could not break the resistance level of 1.1318. This was followed by a slight reversal on Monday morning after its plunge to recover the previous losses and reached 1.131.

Fundamental data from the US particularly the Chicago Fed activity index and Dallas Fed manufacturing activity are anticipated in the afternoon. Meanwhile, reports from German will be published by the CESifo group. This gives signals on the present conditions and business assumptions in Germany. Forecasts are positive for these expected data.