Daily Market Analysis from ForexMart

EUR/USD Daily Analysis: June 17, 2019

The euro major pair is consolidating close to the 200-MA on the 4-hour chart after its recent drop on Friday. Nonetheless, the pair has a possibility to bounce upward.

There was a boost for the pair to move lower due to the US retail sales data which strengthened the dollar. It was not able to hold the level as high as 1.1343 at the beginning of the week even to 1.1200 after the release.

The Fed meeting is anticipated to be dovish that makes the market uncertain if the rate cut will push through, although there is a chance for the price to be reduced by as much as 20% at the beginning of the European session.

On the one hand, the futures market did not turn hawkish after the retail sales, as it simply means an extended rate cut took place earlier than anticipated. The possibility of another two rate cuts in the past meeting is still on the plate.

There is not much expected in the economic calendar except for the speech of Draghi today and tomorrow. Even so, the previous one did not really have an impact on the market. Thus, there might also be no reaction this week.

Although, a short surge in volatility could take place due to the expected inflation data from the euro.

There is a horizontal support level at 1.1204 on the 4-hour chart. This level plays an important role, considering the 1.12 level and the 200-MA close to it. A bounce off may take place when the decline fades this week. There was an important rally in late May that supports the decline in the early June.

There is a strong downward impetus on the hourly chart, considering that there was a bear pattern last week while aiming for 1.1260. When the pair reaches this figure, there is support found below on the descending channel.

Moreover, since the pair strengthened after the release of the retail sales, it implies the strong presence of sellers and they are determined to take the lead. Hence, recovery is not far from happening at the moment.

We can expect resistance at 1.1237 in the next trading session and a confluence with 100-MA on the 4-hour chart. If this succeeds, it opens the possibility of the pair to reach the resistance of 1.1260. Any significant changes may occur after the Fed meeting and for now, trading promotes a range-bound movement.

EUR/USD Daily Analysis: June 18, 2019

After Draghi’s speech, the euro major pair lost 50 pips immediately after an hour, which shows the markets reacted strongly to it.

The euro major pair dropped to some significant levels. Initially, it dropped below the 100- and 200-MA on the 4-hour chart. But then, it didn’t succeed to hold above an important horizontal level of 1.1204, which confluence with the 61.8% from the June low. Moreover, the 200-MA declines close on the 4-hour chart.

A breakout in the important levels would mean the sellers are dominating the trend. The next support level will likely drop to 1.1176, which was previously the support and the March low.

A breakdown towards the psychological level of 1.1200 is important and opens the possibility to reach as low as 1.1176. On the other end, the resistance level will likely be at 1.1204. Fundamentally, the Fed meeting will play a major role tomorrow and could restrict the downward movement of the pair today.

EUR/USD Daily Analysis: June 20, 2019

The EUR/USD trend will be relative to trader’s sentiment to the level of 1.1307 with an upward momentum. If the price stayed over the level of 1.1318, this would confirm the upward trend. However, there is a chance for the pair to shift downward if they did not succeed to reach the support 50% at 1.1270.

The common currency is trading above the US dollar and adjust with the chances of a rate cut in July, influenced by a dovish monetary policy of Fed and rhetorics by Fed chair, Jerome Powell. The Fed fund futures also shows that traders places their bets on rate cuts for the months of July, September and December.

The euro major pair is trading slightly above the level when the ECB President Draghi expressed his dovish sentiments on Tuesday. Hence, it means that markets will either square (close their existing positions) or cover for the rally. However, if the buyers are successful in the level above 1.1348, this can shift the trend.

Overall, the trend is downward looking at the daily chart. The trend shifted downward when the sellers try to take the bottom level of 1.1204. A breakthrough to 1.1181 would mean a continuation of the descending trend. The major retracement area is around 1.1270 to 1.1318, which can act as resistance.

A prolonged move above 1.1307 signifies the presence of buyers, which could lead to a short-rally at 1.1318. However, if the market fails to break the level of 1.11307 and consolidate at this level would indicate the presence of sellers.

The upward momentum can be confirmed of the price movement towards 1.1318 is sustained but could turn downward when the support level fails at 1.1270 (50%).

EUR/USD Daily Analysis: June 24, 2019

The Fed hinted for a decline by 30 bp as the Fed made known their decision to go for a rate cut instead of an increase, which can have a big impact on the markets. Moreover, the bank raised their rates in the previous years without hinting of monetary easing. Yet, the market expects that this can come sooner than expected, which is also reflected in the movement of the dollar.

Hence, the euro major pair can be in a fragile position where it can move easily with the pending incoming data and any signs of a decline would open sales for the bears. In this view, this can cause a big shift in movement for the currency pair.

There is light trading for today given the minimal fundamental event, which may last throughout the day. The next important psychological level will probably be around the resistance of 1.1457. Meanwhile, the 1.1347 seems to be an attractive support level, which was the previous high at the beginning of the month. At the same time, a few confluences were seen in the ascending channel.

The level if 1.1305 is also a probable support level but there is less chance for this. However, short-term dips are needed to sustain the upward momentum. For now, there is no reason for the pair to pull back that low.

EUR/USD Daily Analysis: June 25, 2019

The euro major pair was seen trading a bit lower prior to the opening of the US session. It was able to exceed the peak for five consecutive sessions before its decline. Hence, there is a chance for the common currency to close with the bearish tone with top price reversal. If this happens, the trend could result in a break for two to three days.

However, a price reversal would not necessarily change the trend downward. On the other hand, it shows that the sales are more ideal compared to buying at the current rate, which in most cases would mean that there is excessive impetus directed upward.

The main trend shows an upward direction based on the daily chart, which was confirmed by a successful breakout of buyers. Meanwhile, the trend is moving downhill when considering intraday trading when the market has a downward sentiment.

In case that the price moves to 1.1413, this would mean the dominance of buyers as they try to sustain below 1.1398 in order to have a top price reversal.

The support levels around retracement area of 1.1318 to 1.1278 should be given importance, which will also affect the short-term direction of the euro major pair.

Overall, the movement of the pair will depend on the trader’s reaction to yesterday's closing level of 1.1398. If the price stays around 1.1398 will signify the presence of buyers while a decline from the said level would signal the dominance of sellers. A breakthrough 1.1413 would emphasize the strengthening of buyers and if there is enough momentum, the price will likely look for a momentum to reach 1.1413. Furthermore, reaching the price level of 1.1448 will shift the trend upward. A price movement sustained below 1.1398 would indicate the presence of sellers with the initial target of 1.1381.

EUR/USD Daily Analysis: June 27, 2019

There was less volatility for the euro major pair in the past trading sessions. A significant fundamental report from the US may have an impact on the pair but the focus will be on the expected G20 summit.

Markets are hopeful that the China-US trade war will be subdued by the summit. The future movement of the dollar is important as the markets focus on the US monetary easing amid the sluggish economy and the existence of trade war.

The US data will not exactly move the trading pair but experts anticipate the GDP numbers to progress its annualized percent by 3.1%.

Other reports will probably not influence the movement of the pair such as the weekly unemployment claims report. To be safe, it is suggested to follow the trend. The initial two readings may be against the forecast and at the same time, there were higher revisions last week. Previously, the reading came out earlier than expected.

At the moment, I would look around the level of 1.1347, which shows a peak in early June and close to the 200-MA on both the daily and weekly charts. For the record, the pair has had three drops at this area.

The pair has to move above the level of 1.1400 in order to confirm the uptrend, although this has not happened so far as investors wait for the results of the G20 meeting. Moreover, the speeches of Fed members restrained the continuation of a decline. Hence, a driver is needed for a breakout around the range of 1.1385 and 1.1400, whilst the level of 1.1347 remains to be a psychologically important figure.

EUR/USD Daily Analysis: July 1, 2019

Volatility is present early this week following the previous range-bound trading of the various instruments in the market in the background of ongoing US-Sino trade talks. News on tariff and restriction to Huawei telecom company pushed the equity markets higher and pressured the dollar. Although, this may not last long.

Moreover, pessimistic forecasts of several fundamental data such as the Manufacturing PMI from European countries will further weigh on the common currency. This is in line with the global economic situation in China and Japan, as well as other Asian countries.

The euro major pair has made a significant breakdown today. Other major pairs also experienced such event as seems like a reversal in short-term. However, we should take note of the 200-MA, which is being tested by the US dollar index that could trigger the pair to decline.

Previously, the center of interest was on the fall of the pair at the level of 1.1347. Aside from it being the resistance level, it had a confluence on the 200-MA on the daily and weekly chart.

As for the support, there were several attempts until it broke down earlier this day, which can become the resistance level. Staying on the levels below could induce a correction to the pair and likely to rise higher than 1.1385, which will be favorable for the EUR/USD bulls.

For now, we can expect strong support at 1.1305 with confluence to the 100-MA on the 4-hour chart. Overall, the short-term gives a bearish tone and a breakout to 1.1385 would confirm the continuation of the previously bullish sentiment in the markets.

EUR/USD Daily Analysis: July 2, 2019

The euro major pair has been the top currency pair for the week so far. Also, the dollar is above the Swiss franc than other major currency pairs while it is not doing well for the Canadian dollar.

The EUR/USD decline for this week is mainly due to a stronger dollar, following the trade news between China and the US. Also, it seems that the Fed speeches have also limited the earlier rally of the pair in the second half of June.

Earlier this week, the pair is gaining a downward momentum and dropped below the significant confluence close to support of 1.1350, marking the 200-MA. At the same time, the US dollar index was found to have reached the 200-MA. This opens the opportunity to short the dollar but this is still not yet confirmed.

The next support level will probably at 1.1365 and gave a significant amount of resistance in the past. Over this area, there is a chance for testing the support level of 1.1237, where there is a lot of confluence and also likely to hold buyers. Nonetheless, the pair is far from plunging lower but we can rely on selling in times of rallies for short-term. The trend will likely go up and the present decline may offer an opportunity for a long trade.

EUR/USD Daily Analysis: July 3, 2019

This week began with a decline and the momentum of the EUR/USD pair may have lost. The pair closed on a flat after a failed rally higher than the level of 1.1300. The most recent news on the trade truce between the US and China is the root of strength for the dollar but this may not move steadily.

Another important factor is the gold prices as it moves relative to the economic developments in the US. The yellow metal almost broke down to fresh six year-high that could mean that the increase of the dollar may be almost over.

Today, data from ADP on employment is expected which will give a hint on the US labor market. Thursday is a holiday and this can bring volatility after the closing of the European session.

The indicator was seen at the level of 1.1260 and close to the 100-MA. A strong confluence is possible around 1.1265, which can become resistance and was the peak in the month of May. This kept the pair lower after a few tries and was successfully broken at the beginning of June.

Reaching the level upward to 1.1300 can become difficult. A horizontal level can be at 1.1305 on the daily chart. However, looking at it, a steady move to 1.1300 is needed by bulls.

On the other end, a breakdown lower than the support confluence with the next target at the horizontal level of 1.1237, which is also where the rising channel moves downward since the low level in May.

Nonetheless, the US jobs data to be released today and on Friday may cause a bullish reversal. At the same time, trading may be thin given that tomorrow is a holiday.

EUR/USD Daily Analysis: July 4, 2019

The EUR/USD pair may move close to the bottom and the present bounce off is due to the trade talks between China and the US on the weekend. In turn, this resulted in a correlation across the financial markets.

The 10-year Treasury yields rallied from 2% while gold prices dropped lower than $1400 following a breakout in the previous week. The equity market is under pressure given that the S&P 500 drops from the resistance on the longer timeframe. It is not surprising that the dollar index bounced off more than the 200-DMA.

A divergence between the dollar and other trading instruments has important in considering the trading since the dollar has not undergone a reversal like other assets. Yet, it is also not that logical to expect the euro major pair will further go down present the given fundamental event even looking at how aggressive the market sets in easing in July. Nonetheless, the pair seems to have been trading for just about 1.5% from the multi-year lows.

There is significant confluence in the support close to the trading area which is at the 100-MA and the lower bound channel at 1.1264.

Bull traders will meet an obstruction at 1.1305, which pushed the pair lower yesterday.

The data of NFP on Friday will bring in some volatility to the pair. For now, the pair will likely to continue in consolidating within the range. Support is expected to be close to 1.1264 and the markets are probably not assured with the short-term trade war truce.