EUR/USD Stall in anticipation of the ECB 1.0750-1.1050!

23 Nov 2023

The EUR/USD recorded an increase on Thursday, reaching a daily high of 1.0930 and is now hovering around 1.0900, with limited trading volumes slowing down market momentum. U.S. markets are closed for Thanksgiving, with banks and market operators on pause. The Eurozone manufacturing PMI for November improved to 43.8, surpassing expectations of 43.4. Despite the rise in the EUR following positive pan-European PMI data, the ECB report reveals concerns about inflationary and economic prospects. Eurozone PMI indices exceed forecasts, but significant expansion of activity remains challenging. Inflation continues to decrease, but the ECB is worried about its slow descent. Economic uncertainty persists, with increased downside risks. The ECB predicts inflation will return to 2% in 2025, and no interest rate cuts are expected in the short term. In fact, the euro is at an interesting level, the significant psychological level of 1.09, where it halted after a bullish impulse and bounced off a previous resistance, now support. Personally, I have indicated two possible scenarios: the first with the price moving upward with a target of 1.1050, and the second scenario with the price making a small pullback to 1.0760 before resuming the upward trend. Happy trading to all.

24 Nov 2023

Catatan

The EUR/USD pair is trading in positive territory above 1.0900 during the early Asian trading hours on Friday. The Euro's increase is supported by better-than-expected Eurozone PMI data. Traders will closely watch the German GDP for Q3, IFO Survey, and US S&P Global PMI data. The EUR/USD peaked at 1.0930 and then pulled back to stabilize around 1.0900. The Euro needs a daily close above 1.0950 to pave the way for further gains. On the 4-hour chart, the bias remains to the upside; however, technical indicators indicate weakening momentum, which doesn't necessarily imply further decline but could result in a pullback towards the 1.0750 area before resuming towards 1.1050. The US Dollar Index lost ground on Thursday, providing support to the pair, driven by modest risk-on flows. The Eurozone PMI improved in November, with the Manufacturing index rising to 43.8 from 43.4, surpassing the market consensus of 43.1. The Services sector also saw an increase, rising from 47.8 to 48.2. The German Composite PMI exceeded expectations at 47.1, up from 45.9. The Euro experienced a modest increase after the data, but the momentum did not last due to low trading volume. The figures are still below 50, indicating a contraction in the economy. On Friday, Germany will report a new reading of Q3 Gross Domestic Product (GDP). Additionally, the ZEW survey is also due. The minutes from the latest European Central Bank (ECB) policy meeting showed no surprises. Members highlighted that the uncertainty surrounding the economic outlook had increased since September, and they agreed that most indicators of underlying inflation appeared to have passed their peak. They also agreed that the ECB should continue to stress its determination to set policy rates at sufficiently restrictive levels for as long as necessary to bring inflation back to target in a timely manner. The accounts had no significant impact on the markets. ECB President Lagarde and other members of the Governing Council are scheduled to speak on Friday, but they are not expected to provide clear insights into monetary policy. US markets were closed due to Thanksgiving, and Friday's session will be shortened. Thin trading conditions are expected to prevail. The US S&P Global PMI is due on Friday. Have a great day of trading, everyone.