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Euro Retreats to Balance Line

My Friday expectations for the euro rang true. Although the euro renewed a maximum against the dollar, by the end of the day it closed in the red zone. The price returned to the LB balance line from the U3 line.

The ISM index in the manufacturing sector and the consumer confidence index didn’t meet expectations but did coincide with previous assessments. Therefore, market participants reacted sluggishly to the news after the dollar’s sustained drop.

The rate of the dollar received support against key currencies from the closure of short positions before the weekend and the weakening of the British Pound during the American session.

The US Institute of Management’s April business activity index stood at 51.5 (forecasted 51.6, previous 51.5).

The definitive value for Michigan University’s US April consumer confidence index was 95.9 (forecasted 96.0, preliminary 95.9).

What do I expect from the euro on Monday? Well on Mondays I always consider a movement against Friday, independent of any planned macroeconomic news. Since on Friday the euro/dollar rate closed down, the first half of Monday should see a rebound to the 45th degree. Due to the pound weakening, we could see a rebound to the 67th degree. Keep an eye on the crosses. The pound will stay under pressure with the UK parliamentary elections looming (7th May).

Japan and the UK are taking a day off today because of national holidays. From 10:15 to 11:00 EET, there is a planned release of EU business activity. There’s nothing planned for the evening.

Greece couldn’t come to an agreement with its creditors over the weekend and experts reckon that it’s unlikely one will be found before 6th May.

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Forecasts which are made in the review constitute the personal view of the author. Commentaries made do not constitute trade recommendations or guidance for working on financial markets. Alpari bears no responsibility whatsoever for any possible losses (or other forms of damage), whether direct or indirect, which may occur in case of using material published in the review.

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