Euro: USD/EUR (EUR=X) Exchange Rate Outlook “Neutral” As Three Of The Largest US-China Sticking Points Remain
“EUR/USD short-term technicals: Neutral – Yesterday’s euro downswing ran into important support just above the 1.1000 psychological barrier with the common currency bouncing back in a rather unspectacular fashion from its seven-session low of 1.1004. A move below 1.1000 and then near-term support could at 1.0989 could see EUR cross the 23.6% Fib retracement level (from its Oct rally) at 1.0969 and close in on the 1.0950 mark. Near-term resistance stands around 1.1100 with the Oct top at 1.1179 the next major threshold.” Scotiabank.
The Euro to US Dollar (EUR/USD) exchange rate remained flat, leaving the pairing trading at around $1.1015.
The pairing was left under pressure as while a US-China trade deal is close, according to a White House adviser, several sticking points remain.
White House Adviser, Kellyanne Conway said on Tuesday that three of the largest sticking points remain.
In an interview with Fox News, Conway said:
‘We’re getting really close and that first phase is significant. But the president wants to do this in phases, in interim pieces because it’s such a large, historic trade deal.
‘We continue to negotiate, but those forced tech transfers, the theft of intellectual property, the trade imbalance of a half a trillion a year with the world’s second largest economy, China – this makes no sense to people.
‘But the president wants a deal. But President Trump always waits for the best deal.’
However, officials in China have said they do not anticipate to discuss ‘phase two’ before the November 2020 election.
US Dollar (USD) Exchange Rates Trading Slows Ahead of Thanksgiving
At the start of the week, China’s Global Times stated that the US and China were close to reaching a ‘phase one’ trade deal.
A high-level phone call between US Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin, and China’s Vice Premier Liu He attempted to hammer out the final details of the deal on Tuesday.
The Chinese Commerce Ministry said officials discussed ‘core issues of concern’ and they were able to reach ‘a common understanding on resolving relevant problems’.
However, this did little and the Euro US Dollar exchange rate remained muted, and currency trading is slowing before Thursday’s US Thanksgiving holiday.
Euro (EUR) Exchange Rates Flat as Germans Become More Optimistic
On Tuesday morning, data revealed that German consumer confidence is predicted to improve in the final month of the year.
GfK’s forward-looking consumer confidence index rose from 9.6 to a better-than-expected 9.7 in December, despite forecasts suggesting sentiment would remain unchanged.
Household spending has become a reliable driver of growth in the bloc’s largest economy thanks to record-high employment, pay rises and borrowing costs falling to a historic low.
Added to this, a sub-index that measures economic expectations rose as Germans became more optimistic thanks to ‘tentative signs of easing’ in US-China trade tensions.
Commenting on this morning’s data, Rolf Bürkl, GfK researcher said:
‘The exceptionally high levels of consumer confidence among German consumers have significantly contributed to preventing a recession in Germany in the third quarter.
‘Consumers are therefore optimistic about the upcoming holiday season, one of the busiest times of the year for a number of retail industries such as consumer electronics and toys.
How the year as a whole will be evaluated is determined during this period. And the retail sector can certainly look forward to this period with a healthy dose of optimism.’
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.11.
The projected lower bound is: 1.09.
The projected closing price is: 1.10.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white 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 13.2652. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 4 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 40.41. 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 61 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 -92. This is not a topping or bottoming area. The last signal was a buy 9 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 3 period(s) ago.
Rex Takasugi – TD Profile
FOREX EUR= closed down -0.002 at 1.100. Volume was 29% below average (neutral) and Bollinger Bands were 12% narrower than normal.
Open High Low Close Volume___
1.102 1.102 1.099 1.100 54,545
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.10 1.10 1.12
Volatility: 3 5 6
Volume: 64,839 70,189 92,978
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 1.5% below its 200-period moving average and is in an downward 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 bearish on EUR= and have had this outlook for the last 10 periods.