EUR/USD daily chart
EUR/USD 4-hour chart
EUR/USD 30-minute chart
Additional key levels:
Today Last Price: 1.1338
Today Daily change: -1 pips
Today Daily change %: -0.01%
Today Daily Open: 1.1339
Daily SMA20: 1.1367
Daily SMA50: 1.1391
Daily SMA100: 1.1397
Daily SMA200: 1.1519
Previous Daily High: 1.1368
Previous Daily Low: 1.1318
Previous Weekly High: 1.1344
Previous Weekly Low: 1.1234
Previous Monthly High: 1.1586
Previous Monthly Low: 1.1289
Daily Fibonacci 38.2%: 1.1337
Daily Fibonacci 61.8%: 1.1349
Daily Pivot Point S1: 1.1315
Daily Pivot Point S2: 1.1292
Daily Pivot Point S3: 1.1266
Daily Pivot Point R1: 1.1365
Daily Pivot Point R2: 1.1391
Daily Pivot Point R3: 1.1414
Major equity indexes in the U.S. started the day modestly higher on Friday led by strong gains recorded in energy shares. As of writing, the Dow Jones Industrial Average was up 0.4% on the day while the S&P 500 and the Nasdaq Composite were adding 0.3% and 0.33%, respectively.
A more-than-1% increase in the price of the barrel of West Texas Intermediate boosted the S&P 500 Energy sector, which was the best performing major sector at the momentum with a daily gain of 0.8%. On the other hand, the S&P 500 Consumer Staples is down 0.8% on the day to limit further potential gains in Wall Street.
Meanwhile, a United States Department of Agriculture official recently crossed the wires saying that the U.S. – China trade talks were “positive,” but there still was no clarity from Beijing regarding intellectual property, technology transfer, and structural changes.
The greenback, in terms of the US Dollar Index (DXY), is now losing the grip after climbing as high as the vicinity of 96.80, or session peaks.
US Dollar Index focused on Fedspeak
The index lost upside momentum soon after hitting daily highs at the key 200-day SMA just below 96.80, all in response to the knee-jerk in USD/JPY on renewed trade jitters.
In fact, latest news said the EU could target Caterpillar, Samsonite and Xerox if the US imposes tariffs on imports of autos from the European Union.
The bout of selling pressure is being accompanied by the drop in yields of the US 10-year reference to the area of daily lows around 2.66%.
In the US data space, the greenback will be in the centre of the debate later in the session, as VP R.Clarida (permanent voter, dovish) and NY Fed J.Williams (permanent voter, centrist) will discuss inflation in New York. In addition, St. Louis fed J.Bullard (voter, dovish), Philly Fed P.Harker (non voter, dovish) and R.Quarles (permanent voter, centrist) will take part in a panel discussion on the balance sheet.
What to look for around USD
The FOMC minutes were not as dovish as expected. In fact, the Committee signalled the recent shift in the Fed’s stance was not associated to weakness in the economy but to rising uncertainty in the global markets. Despite the low inflation was back on the debate, the Fed did not rule out further hikes later in the year, although a move on rates remains highly data dependent. On another front, the US-Sino trade talks remain the almost exclusive driver for the markets’ mood in the near term. Furthermore, the deterioration in overseas fundamentals in combination with ‘softer’ stance in G10 central banks should keep occasional dips in the buck somewhat shallow.
US Dollar Index relevant levels
At the moment, the pair is losing 0.02% at 96.59 and a breach of 96.29 (low Feb.20) will target 96.22 (38.2% Fibo of the September-December up move) en route to 95.59 (200-day SMA). On the upside, the next hurdle emerges at 96.80 (10-day SMA) followed by 97.09 (high Feb.19) and then 97.37 (2019 high Feb.15).
• The common currency continues to be weighed down by concerns over the region’s economic health.
• Today’s disappointing German Ifo index adds to the recent dismal data and prompts some selling.
• A modest USD uptick remained capped amid weaker US bond yields and helped limit deeper losses.
The EUR/USD pair dropped to three-day lows in the last hour, albeit quickly recovered few pips and is currently placed in the neutral territory, around the 1.1330 region.
A modest US Dollar weakness, against the backdrop of the previous session’s softer US economic data, did assist the pair to gain some positive traction. The attempted up-move was once again sold into following the disappointing release of German Ifo Business Climate index, which missed consensus estimates and fell to 98.5 for February.
The incoming dismal Euro-zone economic data continued fueling concerns over the health of the region’s economy and kept exerting some downward pressure on the shared currency, with the release of mostly in line final Euro-zone consumer inflation figures failing to lend any support.
Meanwhile, some renewed greenback buying over the past hour or so added to the selling bias and dragged the pair to an intraday low level of 1.1316. However, a subdued/weaker action around the US Treasury bond yields, amid firming expectations that the Fed might refrain from raising interest rates further, kept a lid on any strong follow-through USD uptick and helped limit deeper losses.
Moving ahead, there isn’t any major market-moving economic data due for release and hence, the key focus will be on scheduled speeches by FOMC members, which might influence the USD price dynamics and eventually produce some meaningful trading opportunities on the last trading day of the week.
Technical levels to watch
Yohay Elam, FXStreet’s own Analyst offers important technical levels to be considered for trading the major: “1.1350 remains a battle line, capping euro/dollar early in the day. 1.1372 was the high point this week and serves as a considerable resistance line. 1.1390 and 1.1405 worked as support lines in January and now await the pair as resistance.”
“EUR/USD may find initial support at 1.1330, the low of the day, followed by 1.1320, which was a bottom earlier this week. 1.1295 worked in both directions earlier in February and 1.1275 was the trough this week. 1.1250 and 1.1235 are next down the line,” he added further.
Bank of America Merrill Lynch analysts suggest to remain cautious on the recent rally in EUR/CHF cross.
“Though we maintain a bearish medium-term view on CHF based on valuation, SNB reaction function & shifting balance of payments, combination of one-off M&A flows & CHF declining correlation to risk means lead us to be cautious on recent rally in EUR/CHF for the time being.”
Prices of the barrel of the WTI keep the upbeat tone so far this week and are now trading in fresh 2019 tops near the $57.30 mark.
WTI looks to data, trade
The barrel of West Texas Intermediate has been inching higher in recent sessions on the back of rising hopes on a US-China trade agreement. In this regard, President Trump is expected to meet Chinese Vice Premier later today following this week’s talks.
The recent progress in trade talks has motivated oil traders to ignore another weekly build in US crude oil supplies, this time by nearly 3.7 M barrels, as reported by the EIA on Thursday.
Later in the session, driller Baker Hughes will publish its weekly report on US oil rig count.
What to look for around WTI
Hopes of a US-China trade deal have lent extra oxygen to crude oil prices in past sessions and this should remain a key driver in the very near term. On the broader picture, the ongoing OPEC+ agreement to curb oil production, US sanctions against Venezuelan and Iranian oil exports and the so-called ‘Saudi Put’ are seen propping up the upbeat sentiment in crude prices.
WTI significant levels
At the moment the barrel of WTI is gaining 1.06% at $57.09 facing the next hurdle at $57.25 (2019 high Feb.22) seconded by $58.00 (high Nov.16 2018) and then $59.63 (50% Fibo retracement of the October-December drop). On the downside, a break below $55.22 (10-day SMA) would aim for $54.32 (21-day SMA) and finally $51.15 (low Feb.11).
• The pair showed some resilience below 200-hour SMA and regained positive traction on Friday, with bulls eyeing a move towards conquering the 111.00 mark amid US-China trade optimism.
• Bullish oscillators on hourly/daily charts support prospects for an extension of the ongoing up-move, though traders are likely to wait for a sustained break through the mentioned handle.
• A follow-through buying is likely to trigger a short-covering move and has the potential to accelerate the appreciating move towards a confluence resistance around the 111.30-40 region.
• The said barrier comprises of 200-DMA, 100-DMA and the top end of a short-term ascending trend-channel held since the beginning of this year, and might cap any further gains.
USD/JPY daily chart
Today Last Price: 110.88
Today Daily change %: 0.16%
Today Daily Open: 110.7
Daily SMA20: 110.03
Daily SMA50: 109.96
Daily SMA100: 111.48
Daily SMA200: 111.31
Previous Daily High: 110.91
Previous Daily Low: 110.57
Previous Weekly High: 111.13
Previous Weekly Low: 109.7
Previous Monthly High: 110
Previous Monthly Low: 104.75
Daily Fibonacci 38.2%: 110.7
Daily Fibonacci 61.8%: 110.78
Daily Pivot Point S1: 110.54
Daily Pivot Point S2: 110.38
Daily Pivot Point S3: 110.2
Daily Pivot Point R1: 110.89
Daily Pivot Point R2: 111.07
Daily Pivot Point R3: 111.23
According to analysts at TD Securities, Canada’s December retail sales will give the last update to Q4 GDP tracking ahead of next week’s official national accounts data.
“TD looks for retail activity to end 2018 on a soft note, with a 0.4% decline on both the headline print and ex-auto sales.”
“Real retail sales are likely to post a larger decline than the nominal series due to higher seasonally adjusted prices.”
Canadian retail sales overview
Statistics Canada will publish the monthly retail sales report for the month of December later during the early North-American session at 13:30 GMT. Consensus estimates point to a second consecutive month of decline, though at a slightly slower pace of 0.3% m/m as compared to a 0.9% fall in the previous month. Meanwhile, sales at the retail level, excluding automobiles, are also seen to continue their disappointing run and fall by 0.3% m/m rate during the reported month.
Analysts at National Bank Financial offered their views on today’s upcoming Canadian data and wrote: “We expect both headline and ex-auto sales to have retraced in the month, reflecting poor auto sales and a slump in gasoline prices which likely hit gasoline station receipts.”
Deviation impact on USD/CAD
Readers can find FX Street’s proprietary deviation impact map of the event below. As observed the reaction is likely to be in the range of 38-43 pips in case of deviations up to +0.38 to -0.58, although in some cases, if notable enough, can fuel movements of up to 73-76 pips in the subsequent 4-hours.
How could it affect USD/CAD?
Ahead of the key release, the pair traded with a negative bias and was hovering around the 1.3200 round figure mark. Given the recent bullish run-up in crude oil prices, surprisingly positive readings will be enough to provide a strong boost to the Canadian Dollar and drag the pair back towards challenging the very important 200-day SMA support, currently near the 1.3145 region.
Alternatively, a weaker than expected print might prompt some additional short-covering move and assist the pair to surpass 100-day SMA hurdle, around mid-1.3200s, and dart towards testing weekly highs, near the 1.3280 region. The pair could further aim towards making a fresh attempt towards conquering the 1.3300 round figure mark.
• Canada: Focus on retail sales this week – NBF
• USD/CAD slips to session low, Canadian retail sales eyed for fresh impetus
• USD/CAD Analysis
About Canadian retail sales
The Retail Sales released by Statistics Canada is a monthly data that shows all goods sold by retailers based on a sampling of retail stores of different types and sizes. The retail sales index is often taken as an indicator of consumer confidence. It shows the performance of the retail sector in the short term. Generally speaking, the positive economic growth anticipates bullish movements for the CAD.