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EURUSD: price trading close to the balance line

Previous:

Trading on the EURUSD pair closed down on Monday. Market volatility was high as US data was being published. The EURUSD pair jumped 39 pips on the news. US 10Y bond yields fell by 1.92% to 2.122%. Durable goods orders in the US were significantly lower than expected.

The index for durable goods orders in May was -1.1% (forecast: -0.5%, previous reading: -0.9%).

The dollar eventually recovered all the losses incurred by this news and closed the day up.

Day’s news (GMT 3):

  • 11:00 Eurozone: ECB president Mario Draghi’s speech;
  • 11:05 USA: FOMC member Williams’ speech;
  • 11:30 Australia: RBA deputy governor Debelle’s speech;
  • 11:30 Eurozone: ECB board member Benoît Cœuré’s speech;
  • 12:30 UK: BoE financial stability report;
  • 13:00 UK: BoE governor Mark Carney’s speech;
  • 14:00 Eurozone: ECB board member Peter Praet’s speech;
  • 16:00 USA: S&P/Case-Shiller home prices index (Apr);
  • 17:00 USA: Richmond Fed manufacturing index (Jun);
  • 18:15 USA: FOMC member Harker’s speech;
  • 20:00 USA: Fed’s Yellen speech.

EURUSD rate on the hourly. Source: TradingView.

Intraday forecast: low: n/a, high: n/a, close: n/a.

After the release of US statistics and a jump to 1.1220, the price returned to the balance line at 1.1176. Either the news or statements from central bank representatives should prevent the rate from correcting by 45 degrees. Today is again full of statements from representatives of the major central banks.

I’ve decided not to make a forecast on today’s chart, but I’ve shown a couple patterns on the left that the price could follow on Tuesday. Take a look at the dynamics of the pair from the 13th and 14th of June this year. In one case, the price exited upwards, and in the other, downwards. It will depend on external factors.

1.1200/05 is acting as a resistance on this pattern. Given that Janet Yellen is set to speak today, traders can take a wait-and-see attitude until she speaks. What does this mean for us? It means that we should expect either a flat within a range of 1.1172 – 1.1205 or fluctuations in both directions like on Monday.

Before making any trading decisions today, take a look at the dynamics of US bond yields as well as the EURGBP cross. To buy Euros, the cross should rise and US bonds should fall. For selling Euros, the opposite is true.

The AO indicator is at the zero line, meaning that there is no trend and the indicator has unloaded. The Stochastic oscillator is in the sell zone. When trading opens in Europe, we can expect the rate to return to 1.1178/70.



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