Market Analytics and Technical Considerations
The pace for the EUR/USD for the remainder of the week will be set by data and FOMC minutes.
EUR/USD is still keeping a close eye on the older moving average.
Breaking News on the Euro: EUR on Offer Despite the Surprise EZ PMI Upside
The most recent shock PMIs for the Euro Area outperformed expectations this morning, but they are still firmly in the contractionary range. Although November’s numbers were better than anticipated, the data point to the Euro Area’s economy contracting by about 0.2% in Q4. A recession appears probable, but, as data provider S&P notes, “the latest data provide hope that the severity of the slump may not be as severe as originally feared.”
The US dollar data and the most recent FOMC statements will likely push the pair into the weekend due to holidays throughout the rest of the day. New orders for hard products from manufacturers will be shown in the most recent durable goods statistics, and an assessment on customer perception and expectations will be provided by the Michigan Consumer Sentiment report. The Fed will later provide an updated assessment of the economy and outline its anticipated approach to combating inflation in the FOMC conclusions.
Ahead of the US session, EUR/USD is trading quietly at around 1.0315. The low print of 1.0223 on Monday was promptly bought back, limiting price movement so far this week. Today’s high of 1.0349 has broken a recent string of lower highs, and if the pair closes above Tuesday’s top of 1.0308, then more advances may be possible. Initial resistance is at 1.0371, and at 1.0402 the 200-day moving average enters the picture. Since the middle of June 2021, the couple has not closed this longer-dated ma.
According to statistics from retail traders, 1.28 traders for every 1 short trader demonstrates a net long position of 43.83%. The number of traders who are net-long is down 9.84% from yesterday and up 13.21% from the previous week, while the number of traders who are net-short is up 4.61% from yesterday and up 2.41% from the previous week.
We frequently adopt a contrarian stance to the general consensus, and the fact that traders are net short signals that EUR/USD prices may climb in the future. While posture becomes less net-short compared to last week, it is less net-short than yesterday. We have a further mixed EUR/USD trading inclination based on the current mood and previous moves.
