Euro: USD/EUR (EUR=X) remain towards the bottom of the market consensus

Euro: USD/EUR (EUR=X) remain towards the bottom of the market consensus

Euro: USD/EUR (EUR=X) remain towards the bottom of the market consensus

Our forecast of a move to the EUR/USD 1.10 area on a 3 to 6 month view, remain towards the bottom of the market consensus.  While numerically 1.10 is not far away, psychologically it would represent a fairly significant move.”

“One explanation for the lack of progress on the downside for EUR/USD is the likelihood that the market is already short of EURs.”

“Shorts have been building since the start of the year against a backdrop of weakness in the German manufacturing sector, a dovish ECB and concerns about populism ahead of the European parliamentary elections. There is an argument in the market that the EUR could benefit from short covering going forward as the trade war between the US and China pushes investors into more neutral ground. In our view, the Eurozone’s fundamentals are currently not strong enough for investors to choose the EUR over and above the USD.” 

“After months of worrying about the state of the German economy, the markets breathed a sigh of relief when the Q1 GDP data produced a 0.4% q/q gain. To be fair the strong labour market meant that German domestic consumption has consistently remained firm, but ongoing trade wars and slowing world growth had meant that there is still plenty for the German export sector to worry about.”

“Given that worries about growth can be overlaid with concerned about low policy rates and populism, we don’t see the EUR as picking up much of a safe haven bid in the coming months.”

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1.12.

The projected lower bound is: 1.11.

The projected closing price is: 1.12.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

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 23.5078. This is not an overbought or oversold reading. The last signal was a buy 0 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 41.62. 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 199 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 -99. This is not a topping or bottoming area. The last signal was a buy 0 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 sell 3 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed up 0.000 at 1.116. Volume was 98% below average (consolidating) and Bollinger Bands were 47% narrower than normal.

Open High Low Close Volume___
1.117 1.117 1.116 1.116 2,768

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 1.12 1.12 1.14
Volatility: 3 5 7
Volume: 93,253 117,754 135,754

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 2.0% 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 1 periods.

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