Euro: USD/EUR (EUR=X) Volatility Slows as Investors Await G20 Summit Outcome

Euro: USD/EUR (EUR=X) Volatility Slows as Investors Await G20 Summit Outcome

Euro: USD/EUR (EUR=X) Volatility Slows as Investors Await G20 Summit Outcome

Volatility in EUR/USD has slowed over the past few sessions as the pair has fallen into a range. There is some US data later today that stands to move the pair, however, the emphasis is on the G20 Summit later this week.

Investors are hopeful that the Summit will result in some kind of de-escalation of the trade war between China and the US. Progression will be extremely important for the dollar since the markets are focused on easing measures from the US central bank. This is mostly predicated on a weakening economy moving forward, and the ongoing trade war has been a contributor.

I don’t think US data that will be released later in the day will move the exchange rate much. Analysts expect GDP figures out of the United States to improve to an annualized 3.1%. However, it is the final reading and is not very often that the final release deviates significantly from expectations.

There are some other releases that tend not to have a big impact. One of them is the weekly unemployment claims report. I’ll be keeping an eye on this one to see how the labor markets are doing. The first two readings of the month missed expectations and there were upward revisions for the prior week. Last week’s reading, however, came in ahead of expectations.

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 1.13.

The projected upper bound is: 1.15.

The projected lower bound is: 1.13.

The projected closing price is: 1.14.

Candlesticks

A black body occurred (because prices closed lower 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 27 white candles and 23 black candles for a net of 4 white 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 74.7256. This is not an overbought or oversold reading. The last signal was a sell 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 61.70. 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 225 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 81. This is not a topping or bottoming area. The last signal was a sell 1 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 4 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed down -0.000 at 1.137. Volume was 63% below average (consolidating) and Bollinger Bands were 39% wider than normal.

Open High Low Close Volume___
1.137 1.138 1.135 1.137 41,993

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period     50-period     200-period
Close: 1.13 1.12 1.13
Volatility: 7 6 7
Volume: 64,456 92,856 128,971

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 0.2% above its 200-period moving average and is in an upward trend. Volatility is high 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 17 periods.

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