FUNDAMENTAL BEAM
EURUSD reached a new 8 month high on the back of the US government shutdown,
but soppted at resistance. Draghi’s speeches, Industrial data and the
IMF meeting are the highlights of this week. Check out these events
among others, and an updated technical analysis for EUR/USD, now in a
higher range.
The ECB left all rate unchanged postponing new policy moves until the fragile euro zone recovery
strengthens. The ECB became concerned with rising market interest rates
over the summer, and pledged to keep the benchmark rates at a minimum
low for an extended period. And while the central bank remains ready to
act with new LTROs, falling inflation is currently not a worry. Draghi’s
content message add fuel to the EUR/USD fire, that was lit by the US government shotdown – an unresolved theme dominating the news.
Updates:
EUR/USD daily chart with support and resistance lines on it.
- Sentix Investor Confidence: Monday, 8:30. Euro zone sentiment
improved for the first time in more than two years in September a vote
of confidence in the Eurozone economy, reaching 6.5 points after minus
4.9 in August signaling the end of recession. The reading beat market
forecast for minus 4. A boost in exports and increased spending pulled
the euro zone out of recession in the second quarter of 2013. A further
boost to 10.9 is expected now.
- German Trade Balance: Tuesday, 6:00. Germany’s trade surplus
narrowed in July to 14.5 billion following 15.8 billion in the previous
month as exports weakened. In unadjusted terms, trade surplus decreased
slightly to 16.1 billion euros from 16.9 billion euros, amid a rise in
imports. Exports to the European Union as a whole edged up by 0.8
percent and exports to the rest of the world were up by 3.6 percent, the
statisticians said. A rise to 15.1 billion is expected.
- German Factory Orders: Tuesday, 10:00. German factory orders
declined in July, down 2.7% following a 5.0% boost in demand by
the Paris Air Show a month earlier. Economists expected a small drop of
0.7%. On a yearly base, orders advanced 2%, when adjusted for the number
of working days. German economy expanded 0.7% pulling the 17-nation
euro area out of its longest-ever recession. Manufacturing expanded and
business confidence increased to a 16-month high in August, indicating a
solid pick-up in German economy. A pick-up of 1.2% is expected now.
- German Industrial Production: Wednesday, 10:00. German
manufacturing output fell 1.7% in July, following a 2.0% gain in the
previous month. However a two-month average suggested that industry in
Europe’s largest economy is on the path to recovery. The current drop in
production could be related to the previous month, where output boosted
2.0% driven by a high number of public holidays. The general trend
indicates growth in manufacturing and significantly stronger
in construction. A rise of 1.1% is expected.
- French Industrial Production: Thursday, 6:45. French
industrial output fell unexpectedly by 0.6% in July after a 7.4% plunge
in the previous month, due to lower car production and mineral refining,
casting shadow over French recovery in the beginning of the third
quarter. The data suggests the economy is still weak after pulling out
of recession in the second quarter. A rise of 0.7% is forecasted.
- ECB Monthly Bulletin: Thursday, 8:00. The ECB monthly
bulleting released in September revealed that the Euro area has
recovered during the Q2 of 2013 and is expected to continue its recovery
in the remaining year however, the Euro Zone should continue the
reforms, in order to strengthen recovery. The Euro area real GDP, edged
up 0.3% in the second quarter of 2013. ECB projected an annual GDP
decline of 0.4% in 2013 and an expansion of 1.0% in 2014. ECB interest
rates will remain at present or lower levels for an extended period of
time.
- Mario Draghi speaks: Thursday, 13:00. ECB President Mario
Draghi is scheduled to speak in New York where he is likely to discuss
the Eurozone recovery and his plans for further easing measures to
ensure a speedy recovery. Market volatility is expected. He managed to
deflect sensitive political questions in the last statement. What will
he say now?
TECHNICAL BEAM
EURUSD continued a bullish trend last week as predicted, climbing as high as 1.3639 after which it drops down to 1.3540. This leaves everyone with the question of whether the Greenback has returned to winniing ways just overnight.
We envisage a long term bearish move for EURUSD as seen in the chart below
However, we expect that EURUSD would climb come open of Asian session on monday before afterward starting strongly the bearish southward move as seen in the chart below.
NOTE: Price
predictions produced by FibonacciPrice&PatternTrader may be
affected by unforseen events like hurricane, earth quake, flood and
other natural disasters consequently changing price patterns already
predicted. Hence we advice strict adherence to money management
techniques.
HAPPY TRADING
