EUR/USD: the instrument develops a strong "bearish" impetus 06.07.2022
Good afternoon, dear forum visitors!
NPBFX offers the latest release of analytics on EUR/USD for a better understanding of the current market situation and more efficient trading.
Current trend
The European currency shows a moderate decline, developing a strong "bearish" momentum, formed the day before. EUR/USD is testing 1.0245 for a breakdown, holding near the record lows updated yesterday.
Significant pressure on the position of the instrument was exerted by alarming data on business activity from S&P Global in the eurozone: the Composite PMI fell to a 16-month low, reflecting deterioration in manufacturing activity and growing fears of a full-fledged recession in the economy. In this regard, investors have adjusted their assessments of the prospects for tightening monetary policy, although there is practically no doubt about the July meeting of the European Central Bank (ECB). One way or another, the situation remains tense: the regulator has not raised the rate yet, and the risks of a recession are only increasing.
Today, investors are focused on statistics from the euro area on the dynamics of Retail Sales in May. Analysts' current forecasts are quite optimistic and suggest an increase of 0.4% in monthly terms and 5.4% in annual terms. Also during the day data on Factory Orders in Germany in May will be released, and it is likely to maintain a negative trend at 0.6%.
In the meantime, resources for European consumers will increase in price again. Last week, the Algerian company Sonatrach, whose imports to the EU in June amounted to about 9%, announced the introduction of changes in its pricing policy and, in particular, an increase in tariffs for gas supplies to the eurozone countries. At the moment, negotiations are underway with long-term clients to change the price formula (now it is pegged to Brent Crude Oil), which, however, can be revised every three years.
Support and resistance
Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range is expanding, but at the moment it is not keeping up with the surge of "bearish" sentiment. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic keeps a confident downward direction but is already approaching its lows, which indicates the risks of oversold EUR in the ultra-short term.
Resistance levels: 1.0300, 1.0350, 1.0400, 1.0450.
Support levels: 1.0234, 1.0200, 1.0150, 1.0100.
Trading tips
Short positions may be opened after a breakdown of 1.0234 with the target at 1.0100. Stop-loss 1.0300. Implementation time: 1-2 days.
A rebound from 1.0234 as from support followed by a breakout of 1.0300 may become a signal for opening new long positions with the target at 1.0400. Stop-loss 1.0234.
Use more opportunities of the NPBFX analytical portal: economic calendar
Be ready for any market changes through global events using the economic calendar on the NPBFX portal. The calendar contains all the most important events of the world economy and prognoses for them. In order to get free and unlimited access to the economic calendar and other useful instruments on the portal, you need to pass a one-time registration on the NPBFX website.
If you have any questions about trading instruments, you can always ask an analyst in the online chat on the portal and get a free consultation of an experienced specialist.
Use the current recommendations of analysts on The Walt Disney Co. and trade efficiently with NPBFX.
Good afternoon, dear forum visitors!
NPBFX offers the latest release of analytics on EUR/USD for a better understanding of the current market situation and more efficient trading.
Current trend
The European currency shows a moderate decline, developing a strong "bearish" momentum, formed the day before. EUR/USD is testing 1.0245 for a breakdown, holding near the record lows updated yesterday.
Significant pressure on the position of the instrument was exerted by alarming data on business activity from S&P Global in the eurozone: the Composite PMI fell to a 16-month low, reflecting deterioration in manufacturing activity and growing fears of a full-fledged recession in the economy. In this regard, investors have adjusted their assessments of the prospects for tightening monetary policy, although there is practically no doubt about the July meeting of the European Central Bank (ECB). One way or another, the situation remains tense: the regulator has not raised the rate yet, and the risks of a recession are only increasing.
Today, investors are focused on statistics from the euro area on the dynamics of Retail Sales in May. Analysts' current forecasts are quite optimistic and suggest an increase of 0.4% in monthly terms and 5.4% in annual terms. Also during the day data on Factory Orders in Germany in May will be released, and it is likely to maintain a negative trend at 0.6%.
In the meantime, resources for European consumers will increase in price again. Last week, the Algerian company Sonatrach, whose imports to the EU in June amounted to about 9%, announced the introduction of changes in its pricing policy and, in particular, an increase in tariffs for gas supplies to the eurozone countries. At the moment, negotiations are underway with long-term clients to change the price formula (now it is pegged to Brent Crude Oil), which, however, can be revised every three years.
Support and resistance
Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range is expanding, but at the moment it is not keeping up with the surge of "bearish" sentiment. MACD is going down preserving a stable sell signal (located below the signal line). Stochastic keeps a confident downward direction but is already approaching its lows, which indicates the risks of oversold EUR in the ultra-short term.
Resistance levels: 1.0300, 1.0350, 1.0400, 1.0450.
Support levels: 1.0234, 1.0200, 1.0150, 1.0100.
Trading tips
Short positions may be opened after a breakdown of 1.0234 with the target at 1.0100. Stop-loss 1.0300. Implementation time: 1-2 days.
A rebound from 1.0234 as from support followed by a breakout of 1.0300 may become a signal for opening new long positions with the target at 1.0400. Stop-loss 1.0234.
Use more opportunities of the NPBFX analytical portal: economic calendar
Be ready for any market changes through global events using the economic calendar on the NPBFX portal. The calendar contains all the most important events of the world economy and prognoses for them. In order to get free and unlimited access to the economic calendar and other useful instruments on the portal, you need to pass a one-time registration on the NPBFX website.
If you have any questions about trading instruments, you can always ask an analyst in the online chat on the portal and get a free consultation of an experienced specialist.
Use the current recommendations of analysts on The Walt Disney Co. and trade efficiently with NPBFX.