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Euro/Dollar: Eurobulls Preparing to test 1.1295

Hourly

Yesterday’s Trading:

On Monday the euro/dollar closed up around 1.1250. In the US some ambiguous macro data came out. Representatives from the Fed (Dudley and Evans) didn’t really clarify the interest rate situation for the next meetings. Meanwhile, not all other currencies managed to strengthen against the US dollar.

Consumer spending was up and housing sales in the secondary market was down. Dudley announced that the base rate for the country could be put up at the end of October or in the middle of Deceember, whilst Evans believes that the rate should be left as it is for as long as need be.

Main news of the day:

  • At 11:30 EET, the UK will release August figures for consumer credit mortgage and loan approvals for private individuals;
  • At 12:00 EET, the Eurozone is releasing its September numbers for the economic mood, consumer confidence, business sentiment and manufacturing industry optimism indices;
  • At 15:00 EET, Germany is publishing preliminary September numbers for its CPI;
  • At 17:00 EET, the US will release its September consumer confidence indicator;
  • At 22:40 EET, the BoE’s Mark Carney is due to give a speech.

Market Expectations:

On Tuesday trader attention is on UK, German, Eurozone and US data. The Bank of England’s Mark Carney has a speech planned for the evening and during which we could see high volatility for the pound and euro. Wednesday will see the US Fed’s Janet Yellen give a speech and on Friday the market will get a look at US labor market stats. Since the key pairs are moving all sorts, this swinging is due to continue for today.

Technical Analysis:

  • Intraday target maximum: 1.1300 (Europe), minimum: 1.1225 (the States), close: 1.1240;
  • Intraday volatility for last 10 weeks: 123 points (4 figures).

In the beginning I was considering a fall to the LB, but now I’m thinking: growth to the U3 on a W shape pattern. I’ll be waiting for a return of the euro to 1.1240 from 135 degrees. Carney is giving a speech tonight, so we’ll need to keep an eye on the euro/pound cross. This pair will determine whether the euro/dollar returns to the balance line.

Daily

The price range on the two pinbars has limits of 1.1115 and 1.1295. The euro has come back at the USD and hit 1.1261. It’s likely that today we’ll see a test of 1.1295. The only thing I’m not sure about is the continued growth before the NFP and a break in the trend line. Now to the Weekly.

Weekly

The euro/dollar is still in a sideways trend between 1.1086 and 1.1459. We need to wait for it to snap out of this range.

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