EURUSD pair gave back all its gains last week as it was widely expected. As Turkey came back from a long holiday, pressure resumed over the exposed Europe area. Another factor behind last Friday’s drop was the disappointing number in Europe’s CPI. As for the coming week traders will mostly focus on Market manufacturing numbers from different EU countries and by Friday the European Gross Domestic Product, where expectations are pointing to an unchanged 2.2%. From a dollar point of view, ISM manufacturing on Tuesday expected to be lower at 57.7. On Wednesday many Fed officials will speak and it is worth listening to as they can verbally intervene to the Fed’s rate hike path. On Thursday ADP employment pointing lower at 187K. And finally, on Friday, the nonfarm payrolls are expected higher at 187k a better number than last 157k.
Technically speaking the pair is negative to neutral. As the pair did not manage to break and hold above 1.1740 (last week’s high), traders are now tracing the Fibonacci levels for retracement at 38.2% and 61.8% or, break below those levels and continuation of downside where retesting the low of 1.1300. Our traders maintained their trading style to buying into the dips and targeting profits at 1.1740
Good news from Brexit camp were well applause last week from this pair. As soon as news crosses the wire a sharp upside move took place and changed the overall fundamental picture to positive. EU Chief negotiator Michael Barnier announced that the EU would be prepared to offer a post-Brexit partnership to the UK. From the economic calendar side this week we have only one event, on Tuesday the very important inflation report will be released.
Technically the pair is changed from negative to positive. Pulling a Fibonacci retracement on the 4H chart and in combination with the break out of the downside trend lines we may expect the recovery to continue up to the 23.6% at 1.3080. If it breaks above and holds this level the pair may continue to build momentum and retest support of 1.3300 standing on the 38.2% Fibonacci level.
*The material does not contain an offer of, or solicitation for, a transaction in any financial instruments. 10TradeFX accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representationor warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losing all your invested capital, so please make sure that you fully understand the risks involved.