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Global Economic Analysis: Potential Recession in the EurozoneEurope The S&P Global Purchasing Managers' Index fell to 47.1 in November, marking the sixth consecutive month below the 50-point expansion threshold, despite exceeding economists' predictions. Both manufacturing and services sectors reflect a similar trend. Germany will suspend constitutional limits on net new borrowing for the fourth consecutive year after Prime Minister Olaf Scholz's government was compelled to implement sweeping budget reforms following a recent ruling by the national supreme court. This emergency move to lift the so-called "debt brake" will be part of the 2023 budget revision, expected to be presented by Finance Minister Christian Lindner next week. Asia China may have concluded its interest rate cuts as policymakers shift towards alternative measures to support the economy and maintain credit growth stability in the new year. Initial trade data from South Korea indicates that exports are likely to sustain growth momentum this month, continuing the recovery after a year-long recession. South Korea, a crucial global exporter, plays a significant role as an indicator of the global economic condition through its export performance. Emerging Markets Thailand's economic growth unexpectedly slowed in Q3 due to a decline in manufacturing caused by weak exports, supporting the new government's $14 billion cash support program as planned. Chile's economy expanded more than forecasted in Q3, driven by the mining sector, as the central bank began to ease monetary policy. Gross domestic product increased by 0.6% from July to September compared to the same period last year. In the prolonged interest rate decisions across Africa, the region's largest economies are expected to maintain higher interest rates for an extended period. Angola and Zambia raised rates this week to curb persistent inflation and stabilize their currencies, with Nigeria also planning an interest rate hike. South Africa maintains the current rate, and other countries including Morocco, Kenya, and Ghana are likely to follow suit.
by Larissa-Trader
EURUSD has an uptrendThe dollar index DXY, which measures the U.S. currency with six peers, eased 0.029% to 103.73, staying close to the two-and-a-half month low of 103.17 it touched earlier this week. The index is down 2.8% for the month, on course for its weakest monthly performance in a year on rising expectations that the Federal Reserve is done raising interest rates and could start cutting rates next year. Markets have dialled back expectations of Fed rate cuts in 2024, with futures now showing a 26% chance that the Fed cuts its target rate at the March 2024 policy meeting, according to CME Group's FedWatch tool. That compares with a 33% chance last week. The euro stood at $1.0904, having risen 0.16% overnight after a series of preliminary surveys showed recession in Germany may be shallower than expected, which offset a downbeat reading of French business activity.
Long
by TinaTradingGold
EURUSD's uptrend returnsThe EUR/USD currency pair remains steady around 1.0900 as markets anticipate the release of Eurozone Purchasing Managers' Index (PMI) figures, with investors looking for signs of economic recovery in area. Upcoming data, expected to show manufacturing PMI at 43.4, services PMI at 48.1 and composite PMI at 46.8, could provide insight into the economic health of the US. Eurozone amid challenging global conditions. In recent statements, Bundesbank President Joachim Nagel indicated that interest rates in the Eurozone may be approaching a peak, suggesting a cautious approach to further increases. ECB Vice President Luis de Guindos reinforced this view by backing a data-driven approach and downplaying discussions of possible interest rate cuts in the near future. Investors and analysts will be closely watching the PMI figures for signs of the Eurozone's economic trajectory, which could influence the European Central Bank's monetary policy decisions. Europe in the coming months. A better-than-expected PMI result could bolster confidence in the euro, while weaker figures could raise concerns about lingering economic headwinds in the region.
Long
by TinaTradingGold
EUR/USD Maintains Slight Decline Below 1.0900 The EUR/USD exchange rate continues its descent after failing to hold above 1.0950. On Wednesday, the pair encountered resistance at 1.0920 before experiencing another round of price depreciation. Finding support at 1.0850, the potential for further downside exists, targeting the crucial support level at 1.0830. The short-term downtrend line is positioned at 1.0900, and a move above this level could provide momentum for the Euro. On the 4-hour chart, technical indicators suggest a continued bearish trend but lack strong conviction. The MACD indicator signals bearish tendencies, while the Relative Strength Index (RSI) moves laterally, indicating potential consolidation in the range of 1.0890 to 1.0860 or around the 1.0830 region. A drop below the subsequent level would increase downward pressure, leading to additional losses for the Euro. The EUR/USD rate retreated on Wednesday to the 1.0850 area, driven by a stronger US Dollar following the release of US economic data. This pair continues to pull back from monthly highs in a corrective move. Bundesbank President Joachim Nagel stated on Wednesday that interest rates in the Eurozone are nearing their peak. Market participants believe that interest rates are unlikely to increase further unless inflation recovers. Key data will be released on Thursday, including preliminary PMI indices for November. Forecasts suggest further improvements, but all figures are expected to remain below 50. This data could impact the market, and any negative surprises may add pressure to the current adjustment in EUR/USD. The Flash Services PMI is expected to rise from 47.8 to 48.0, and Manufacturing from 43.1 to 43.3. Also on Thursday, the European Central Bank (ECB) will release the minutes of its latest monetary policy meeting. The US Dollar has further recovered from monthly lows, gaining momentum after the release of mixed US data showing a larger-than-expected decrease in initial jobless claims and a significant drop in durable goods orders. The US market will be closed on Thursday. Bond yields continue to rise, supporting the ongoing adjustment of the US Dollar. Market sentiment seems poised for a consolidation ahead.
by Larissa-Trader
1
EUR/USD Holds Near 3-Month Highs, Driven by Market ExpectationsThe EUR/USD pair enters a consolidation phase during Tuesday's Asian trading, hovering just below the key level of 1.0900, marking the highest point since August 14th. The pair has seen consecutive gains, surpassing 1.0900, with the upward trend sustained above crucial daily Simple Moving Averages. However, the Relative Strength Index (RSI) above 70 signals overbought conditions. On the 4-hour chart, overbought conditions persist, but no significant correction signs are evident. Further upside potential remains as long as prices stay above 1,0885. In case of a pullback, the next support level to watch is at 1,0830. On the upside, immediate resistance is around 1,0965, with a break aiming for 1,0990. The US Dollar extended its decline on Monday, propelling the EUR/USD to a three-month high near 1.0950. The prevailing market expectation that the Federal Reserve (Fed) has completed interest rate hikes continues to weigh on the US Dollar, driven by stock market gains on Wall Street. The Dollar Index (DXY) dropped 0.35% to 103.45, the lowest since August. Market optimism regarding the Fed's rate hike completion, coupled with Wall Street's equity rally, maintains the upward bias for EUR/USD. The Dollar is still vulnerable as the Dollar Index seeks support. On Tuesday, the Fed will release the latest FOMC meeting minutes. In terms of US data, the Fed Chicago National Activity Index and Existing Home Sales are scheduled. In Europe, the upcoming crucial report will be the preliminary PMI for November, set to be released on Thursday. As long as the risk-on environment prevails, the EUR/USD pair has the potential for further gains. However, considering the superior economic performance of the US compared to the Eurozone, fundamental factors continue to support the US Dollar.
by Larissa-Trader
1
EUR/USD Holds Near 3-Month Highs, Approaching 1.0950"The EUR/USD exchange rate has risen for the second consecutive day, surpassing the 1.0900 level. The upward trend remains intact as prices are holding above significant Simple Moving Averages on the daily chart. However, the Relative Strength Index (RSI) above 70 indicates overbought conditions. On the 4-hour chart, overbought conditions persist, but there are currently no signs of a major correction. Further upside potential exists as long as prices stay above 1.0885. If a pullback occurs, the next support level to watch is 1,0830. On the upside, immediate resistance is around 1.0965, and a higher breakout aims for the 1.0990 level. The US Dollar extended its decline on Monday, pushing the EUR/USD rate to a three-month high near 1.0950. The bias continues to favor the upside as the US Dollar remains vulnerable. Market expectations that the Federal Reserve (Fed) has completed its interest rate hikes continue to weigh on the US Dollar, and it is further fueled by stock market gains on Wall Street. The US Dollar Index (DXY) fell 0.35% to 103.45, its lowest since August. The greenback is still seeking support. On Tuesday, the Federal Reserve will release the latest FOMC meeting minutes. In terms of US data, the Fed's National Activity Index and Existing Home Sales are on the schedule. In Europe, the upcoming key report will be the preliminary PMI for November, scheduled for Thursday. As long as the risk-on environment persists, the EUR/USD pair has the potential for further gains. However, considering the superior economic performance of the US compared to the Eurozone, fundamental factors still support the US Dollar.
by Gwen_Humuna
1
EUR/USD Analysis: Exploring Upward MomentumThe euro has exhibited a week-long uptrend, testing the previously established ascending trendline as a significant resistance level. The 1.09 mark stands out as a substantial barrier, and if successfully surpassed, the market may set its sights on the 1.10 level. Beyond that point, there is potential for the market to extend its upward trajectory. On the downside, multiple support levels exist near the 200-week EMA, particularly around the 1.0720 mark. As the euro charts its course, traders are closely monitoring these key levels, anticipating potential breakthroughs or pullbacks. The dynamics of the currency pair suggest a nuanced interplay of market forces, creating a landscape ripe for strategic analysis and decision-making.
by Larissa-Trader
EUR/USD Extends Upside Momentum Above 1.0700The EUR/USD pair rose to 1.0700 in the early Asian trading session on Tuesday. Lower US Treasury bond yields are exerting pressure on the US Dollar (USD), providing some support for this currency pair. However, concerns about economic downturn in the Eurozone may limit the Euro's upward trajectory. The EUR/USD exchange rate has increased for the second consecutive day and is holding above the 20-day and 55-day Simple Moving Averages (SMAs). Technical indicators on the daily chart suggest a modest bullish trend. However, closing below 1.0615 would negate positive prospects. On the 4-hour chart, the pair is testing the short-term downtrend line around 1,0705, while staying above the support zone at 1,0655. Technical indicators are not providing clear signals. A breakout above 1,0710 would open up opportunities for further strength, with subsequent targets at 1,0735 and then the previous high near 1,0760. On the other hand, an acceleration of the downside may occur if the pair breaks below 1,0650, initially targeting 1,0635 and then 1,0610.
by Larissa-Trader
1
EUR/USD Maintains Modest Gains Near 1.0700"EUR/USD is holding slight gains near the 1.0700 mark in European trading on Monday. The US dollar started the new week on a defensive note, despite higher US bond yields. Traders are awaiting GDP data for the Eurozone and US inflation figures later in the week. The Relative Strength Index (RSI) on the 4-hour chart has dipped below 50, while EUR/USD falls below the midpoint of the upward regression channel, indicating a short-term bearish outlook. If EUR/USD fails to stabilize above 1.0680 (midpoint of the upward channel), sellers may remain active. In this scenario, the 50-period Simple Moving Average (SMA) adjusts as temporary support at 1.0660, followed by 1.0640 (38.2% Fibonacci retracement of the latest downtrend) and 1.0620 (lower limit of the upward channel, SMA 100). On the upside, resistance levels lie at 1.0700 (50% Fibonacci retracement), 1.0730 (upper limit of the upward channel), and 1.0750 (61.8% Fibonacci retracement).
by Gwen_Humuna
1
EUR/USD Maintains Position Below 1.0700The EUR/USD pair kicked off the new week on a positive note during the early Monday trading hours in Asia. The recovery of this currency pair is supported by the prevailing weakness of the US Dollar (USD). Having bounced from last week's low of 1.0656, the pair remains constrained below the resistance level of 1.0700. Currently, the main currency pair is trading around 1.0690, marking a 0.04% increase for the day. The University of Michigan Consumer Sentiment Index declined to 60.4 in November from 63.8 in October. The 12-month inflation expectations for the US increased to 4.4% from 4.2%, while the 5-year expectations rose to 3.2% from 3.0%. A crucial upcoming event is the release of the CPI report for October. A better-than-expected outcome from this report could heighten the probability of the Fed raising interest rates again in December. Last week, Federal Reserve Chair Jerome Powell mentioned that if further policy tightening is deemed appropriate, the central bank would not hesitate to do so. On the other hand, the European Commission will release its economic growth forecast on Monday, with downward adjustments expected for the 2024 growth outlook. Preliminary GDP data for the Eurozone for Q3 is also due, with a quarterly estimate of a 0.1% decrease and an anticipated 0.1% increase on a yearly basis. Additionally, some ECB figures, including Lagarde, De Guindos, Lane, and Villeroy, may reiterate that any discussions about interest rate cuts are premature. The International Monetary Fund stated last week that rapidly rising wages in the euro area could lead to prolonged inflation, suggesting that the European Central Bank should maintain interest rates at or around record highs in the coming year to alleviate pressure on prices. However, the market anticipates a rate cut, possibly as early as April, with a total of 90 basis points of cuts priced in by the end of next year. What are your thoughts on this currency pair?
by Larissa-Trader
2
EUR/USD Under Pressure Post-Disappointing US Data"EUR/USD struggles to find direction on Friday, hovering within a narrow range just below 1.0700. US Consumer Sentiment, falling to 60.4 in November from October's 63.8, adds pressure. Wall Street trades in the red after Thursday's decline, impacting USD demand. The Relative Strength Index (RSI) on the 4-hour chart drops below 50 as EUR/USD slips below the midpoint of the upward regression channel, indicating short-term downside prospects. If EUR/USD fails to stabilize above 1.0680 (midpoint of the upward channel), sellers may remain active. In this scenario, the 50-period Simple Moving Average (SMA) adjusts as temporary support at 1.0660, followed by 1.0640 (38.2% Fibonacci retracement of the latest downtrend) and 1.0620 (lower limit of the upward channel, SMA 100). On the upside, resistance levels lie at 1.0700 (50% Fibonacci retracement), 1.0730 (upper limit of the upward channel), and 1.0750 (61.8% Fibonacci retracement).
by Gwen_Humuna
1
EURUSD Longs - A grade setup blueprintThis time we are diving into an A grade setup that was presented to us on the 08/11/2023. After anticipating a bullish move from this exact zone marked out last Sunday's post. I will be breaking down what I would look for once price taps into our higher time frame POI (16hr demand zone on EU). At first I noticed that as price was slowing down momentum, wyckoff accumulation started to become more evident. During the process of liquidating previous buyers, it changed character on the 10min which left a 5min OB that was unmitigated. From then, my SPRING was confirmed as well as my entry price. In addition to this, the order block was also in line with the 0.78 mark on the fib range and it was at a very discounted area hence why price was volatile as soon as it got tapped in. As I also realised that price had filled the imbalance left from last Fridays NFP event, I knew price would want to continue in the trend it had set, which was a bullish order flow that consisted of higher highs and higher lows. Lastly I would set my take profit target to be in areas of liquidity that price would attract to, and in this case it was the amount of untouched Asia highs that was left from previous days. However, I also realised that for price to move back down, it would need to mitigate a supply which was also left above the points of liquidity. P.S. The mini equal lows that was swept was just extra confluence that price would react off my 5min OB that caused the CHOCH to happen, and because price had perpetual liquidity sweeps, I knew that there was minimal reversal magnets that could try interfere with our trade. Ultimately, this was why we was able to catch a 1:12 RR with basically ZERO DRAWDOWN...
Long
by Hassan_fx
3
The ECB needs to keep interest rates above the 4% threshold to "IMF Europe Director Alfred Comer warned the ECB that if it does not cut interest rates soon, it will be forced to tighten monetary policy more costly later. The headquarters of the European Central Bank in Frankfurt am Main, Germany. (Photo: AFP/TTXVN) The International Monetary Fund (IMF) said on November 8 that rapid wage growth in the euro zone could push inflation further higher. The European Central Bank (ECB) should therefore keep interest rates at record levels next year to "ease" price pressures. Last month, the ECB broke its record of 10 consecutive interest rate hikes. Markets are therefore predicting that the bank's next move could be a rate cut in April.
Long
by AstronautPioneer
EURUSD: Evolution and movement trend of EURThe euro lost value compared to the USD today as the dollar had a significant increase. Germany released some disappointing data. Following the RBA's announcement that this would be the final increase in interest rates, the value of the Australian dollar plummeted dramatically. Germany's industrial production weakened last month, according to data, which had an indirect negative impact on the euro. Jerome Powell, the chairman of the Fed, will talk on Wednesday and Thursday. Following the Fed policy meeting last week, the markets will now be watching to see if he sticks to his more accommodating position. The euro lost value compared to the USD today as the dollar had a significant increase. Germany released some disappointing data. Following the RBA's announcement that this would be the final increase in interest rates, the value of the Australian dollar plummeted dramatically. Germany's industrial production weakened last month, according to data, which had an indirect negative impact on the euro. Jerome Powell, the chairman of the Fed, will talk on Wednesday and Thursday. Following the Fed policy meeting last week, the markets will now be watching to see if he sticks to his more accommodating position.
Long
by Chart_MasterPro