Euro: USD/EUR (EUR=X) Will the Dollar Take the Spotlight Again this Week?
The US dollar dominated the major currencies last week and the trade-weighted index (DXY) made a notable technical development.
DXY had been trading in a range from the last week of December until the middle of last week but broke higher from the range to signal a recovery. Friday’s US jobs report caused a small pullback but the index still managed to close the week with a half a percent gain.
The NFP report from Friday revealed a smaller than expected job gain in December and the average hourly earnings component fell short as well. Despite this, the unemployment rate held at a multi-decade low of 3.5%.
The bulk of the majors are trading relatively flat on the day with the exception of the British pound. GBP/USD is down half a percent at the time of writing and has crossed below the psychological 1.3000 handle.
Retail sales figures out of Italy were softer than expected, showing a decline of 0.2% in December versus the analyst estimate of a 0.1% gain. Further weakening the report was a downward revision for October to show a decline of 0.3% versus the originally reported fall of 0.2%.
The economic calendar does not contain any market-moving data releases pertaining to EUR/USD for the rest of the day.
EUR/USD recovered higher following Friday’s US jobs report and attempted to continue the recovery in the early day. However, a confluence of resistance in the pair has resulted in some selling pressure.
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: 1.11.
A white body occurred (because prices closed higher 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 22 black candles for a net of 5 white candles.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
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 28.6932. 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 51.31. 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 -39. This is not a topping or bottoming area. The last signal was a sell 7 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 up 0.001 at 1.113. Volume was 1% below average (neutral) and Bollinger Bands were 9% narrower than normal.
Open High Low Close Volume___
1.112 1.115 1.111 1.113 64,688
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.12 1.11 1.11
Volatility: 5 5 5
Volume: 55,974 58,667 78,817
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 0.0% below 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 23 periods.