EUR/USD keeps the red near 1.0875 as stocks rally, ZEW eyed

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 19, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The EUR/USD pair remains under pressure in the European morning, although retreats slightly from session lows, as focus now turns towards the ZEW surveys for further momentum.

    EUR/USD finds support at daily S1

    Currently, the EUR/USD pair trades -0.22% lower at 1.0870, recovering from fresh session lows reached at 1.0860 in last hours. The main currency pair continues to consolidate the downside, having failed to resist 1.09 handle, as a generalized risk-on market profile on the back of relief rally in the European stocks, continues to curb the demand for safe-havens such as the Euro. Amid risk-on environment, investors prefer to take the yield advantage and hence, give up lower-yielding assets in favour of risky/ higher-yielding ones. At the moment, Germany’s DAX jumps +2%, the UK’s FTSE rockets +1.56%, while the pan-European benchmark, the Euro Stoxx 50 advances nearly +2%.

    The major also remains weak on the back dismal German CPI data, while the upcoming economic news from Germany and Euro zone are also expected to come in weaker. The German Economic sentiment is seen heading lower to 8.0 in January from 16.1 measured in December, while the Current Situation Index is also expected to tick down to 53.0 from 55.0 booked previously.

    However, the downside remains cushioned on the back of a mixed US dollar in Europe. The greenback remains heavily sold-off against the higher-yielding currencies such as the Antipodeans and the GBP. While remains better bid versus the safe-havens, including the yen, Swiss franc and the common currency.

    EUR/USD Technical Levels

    In terms of technicals, the pair finds the immediate resistance is seen at 1.0940/52 (Jan 18 High/ 100-DMA). A break beyond the last, doors will open for a test of 1.0984/1.1000 (Jan 15 High/ round number). On the flip side, the immediate support is placed at1.0852 (50-DMA/ Jan 15 Low), below which 1.0800 (psychological levels) could be tested.
    For more information, read our latest forex news.

Share This Page

free forex signals