Euro: USD/EUR (EUR=X) German Retail Sales Tops Expectations in December

Euro: USD/EUR (EUR=X) German Retail Sales Tops Expectations in December

Euro: USD/EUR (EUR=X) German Retail Sales Tops Expectations in December

Retail sales in Germany rose 2.1% last month, beating out the analyst estimate for a rise of 1.1%. It was the first time the data beat expectations since the summer.

Services data was also better than expected with German, Italian, and Spanish PMI data all exceeding analyst expectations. French services PMI data was in line with expectations.

For the entire Euro area, the services PMI improved to a four-month high, also ahead of the analyst estimate. The positive data has kept the single currency underpinned after a decline last week on the back of disappointing manufacturing data.

EUR/USD has been trending higher since the start of the fourth quarter of 2019. Buyers look to have taken last week’s dip as an opportunity to get involved in the broader uptrend.

However, it might be too early to tell if the currency pair has resumed within its uptrend. The US dollar index (DXY) remains in the green for January and showed upward momentum last week that resulted in a reversal candle on a weekly chart. Price action among the majors over the past few weeks has been dominated by dollar fluctuations.

Technical Analysis

The EUR/USD recovery has reached resistance from a horizontal level at 1.1180. This level held the pair lower in October initially, and then several times since. On a weekly chart, the pair has yet to post a close above it.

Further, last week’s price action has led to a weekly candlestick print for EUR/USD that suggests exhaustion, or even reversal potential. Bulls might be cautious in light of this.

Technical Indicators

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 1.11.

The projected upper bound is: 1.13.

The projected lower bound is: 1.11.

The projected closing price is: 1.12.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 28 white candles and 21 black candles for a net of 7 white candles.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 48.2756. This is not an overbought or oversold reading. The last signal was a sell 2 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 62.14. 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. (ERROR: Function did not return a value)

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 65. This is not a topping or bottoming area. The last signal was a sell 2 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed up 0.004 at 1.119. Volume was 13% below average (neutral) and Bollinger Bands were 11% narrower than normal.

Open     High      Low     Close     Volume___
1.117 1.121 1.115 1.119 57,796
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1.12 1.11 1.11
Volatility: 5 5 5
Volume: 40,870 58,456 80,300

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.

Summary

FOREX EUR= is currently 0.5% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. 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 18 periods.

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