Trading on the EUR/USD pair closed down on Monday. The EUR/GBP cross sparked a downwards correction after the publication of an opinion poll for the UK general election by ICM. The pair restored after retreating to the trend line, lb and the 45th degree.
Market activity was low during the US session, when some ambiguous statistics came out. The number of factory orders for April fell in line with expectations. The previous reading was significantly revised upwards. The ISM services PMI for May dropped slightly on the previous month.
These statistics haven't changed the sentiment on the market with regards to the FOMC's June meeting. The probability of a rate hike this month stands at 95.8%.
The Euro has appreciated against the dollar by 0.19% in Asia, to 1.1275. There has been an increase in volatility since morning. This increase was caused by the Reserve Bank of Australia's meeting, the ECB's meeting, and increased caution ahead of the parliamentary elections in the UK. Additionally, on Thursday, former FBI director James Comey is set to testify to Congress. Everyone is waiting to see what he will say about Trump and Russia.
The market is moving in a similar fashion to the movements seen between the 31st of May and 2nd of June. Growth, rebound, slow recovery then acceleration. given that the trend line has resisted any approaches during the Asian session, the US dollar is set to slide against most other currencies and there is a high risk of the EUR/USD rising to 1.1336 (112 degrees). I haven't made any forecast's on today's chart since I wasn't able to pick a scenario. As the parliamentary elections and central bank meeting approach, there are currently more questions than answers.
Day's news (GMT+3):
EURUSD rate on the hourly. Source: TradingView
Intraday forecast: low: n/a, high: n/a, close: n/a.
Looking at the hourly chart, we can see that the Euro has undergone a technical correction towards the balance line lb. We know that the ICM survey is behind this correction. Gold and yen are appreciating. Traders are fleeing to safe haven assets ahead of the UK election.
In Asia, the Euro is rising on the back of a drop in US bond yields. The dollar is falling across the market. For now, there are more questions than answers and I can't choose a scenario. Let's wait and see how the market opens in London.