Euro: USD/EUR (EUR=X) Exchange Rates Flounder as Political Uncertainties Come Back into Focus
In recent weeks, demand for the Euro has been a little stronger. While this hasn’t been enough to help the Euro to sustain gains against a stronger US Dollar, it has limited the Euro to US Dollar exchange rate’s losses.
Investors have been hopeful that the Eurozone’s economy has been more resilient than expected this year so far, due to signs of strength in datasets over the past few weeks.
However, other factors have weighed on the Euro’s appeal and left the shared currency’s movement mixed rather than strong.
There are still signs of weakness in the latest Eurozone data, but the primary cause of Euro weakness this week so far has been uncertainty over the upcoming EU elections.
Citizens across EU nations will head to the polls on Thursday to vote for parties to represent their nation in EU Parliament.
Investors are becoming more anxious about the possibility that Eurosceptic Parties will perform particularly strongly during the elections.
Rising Euroscepticism would leave investors more anxious about the stability of the Eurozone and the Euro. As a result of this political uncertainty, the Euro is unappealing today.
USD Exchange Rates Steady Following Last Week’s Strength
Investors piled into the US Dollar last week, despite rising concerns that the US economy could be hit by a US-China trade war, as well as mixed US data leaving investors concerned that the Federal Reserve could cut US interest rates at some point over the next year.
This was largely due to market demand for safe haven currencies. The US Dollar, as a safe haven currencies, often benefits in times of market uncertainty, such as the recent resurgence in US-China trade tensions.
As concerns of a US-China trade war deepen and investors are anxious that this could negatively impact the US economy too, the US Dollar’s potential for gains has been limited.
This, as well as market anticipation for this week’s upcoming Federal Reserve news, has prevented the US Dollar from seeing further gains against the Euro.
On the market’s hesitance to move much, Chuck Tomes from Manulife Asset Management said that a speech from Fed Chairman Jerome Powell tonight was likely to be watched closely:
‘[the speech] will be something we’re watching very closely to see if there are any comments from the Federal Reserve as to if they feel there will be a change in their outlook … because of the increased trade tensions,’
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.13.
The projected lower bound is: 1.11.
The projected closing price is: 1.12.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 9.3248. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 15 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 41.49. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 197 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -128.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 4 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 1 period(s) ago.
Rex Takasugi – TD Profile
FOREX EUR= closed up 0.001 at 1.117. Volume was 44% below average (neutral) and Bollinger Bands were 45% narrower than normal.
Open High Low Close Volume___
1.116 1.118 1.115 1.117 75,727
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.12 1.12 1.14
Volatility: 3 5 7
Volume: 108,934 122,225 136,796
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX EUR= is currently 2.0% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of EUR= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on EUR= and have had this outlook for the last 4 periods.