EUR / USD: Euro is under pressure to mid-December.Trading recommendations
Trading recommendations and Technical Analysis – HERE!
Financial markets have reacted quite poorly to yesterday's data on US GDP for the 3rd quarter, were weak data for the 2nd quarter and worse prognosis (1.5% vs. + 1.6% and + 3.9% in Q2). The indices of domestic prices and personal expenses were also slightly below forecast in Q3 (1.2% and 1.3%, respectively). Left a little later indices of consumer prices in Germany in October showed almost no growth. The dollar was supported by data on applications for unemployment benefits in the last week in the US were better than expected towards their reduction, which may indicate a further improvement in the US economy.
Although more modest than expected GDP growth in the 3rd quarter in the US dollar pairs, including a pair of EUR / USD, rather sluggishly adjusted to the growth of the dollar on Wednesday. Then, the Fed indicated that the economic slowdown in global growth does not cause severe anxiety and signaled the continuing possibility of interest rate rises in the US in December. Against the background of the Fed the dollar strengthened sharply against the euro and gold.
The yield on 10-year US Treasury bonds rose sharply by almost 2.2%, which may indicate investors prepare for an early rate hike.
Despite the fact that the EUR / USD yesterday was able to fight off almost half of the losses for the environment, today the pair is trading in a narrow range and the opening of the European session, returned to mark the opening of the trading day at 1.0984. The euro is under pressure as in most cross pairs, which may indicate a general negative sentiment towards the prospects of the currency, despite the current general weakening of the US dollar in the other major currency pairs.
Comments of the ECB Mario Draghi on Thursday, showing the determination of the ECB to use any of the existing mechanisms at its disposal, including lowering the interest rate or adjustment of the asset purchase program, will put pressure on the euro until the next meeting of the ECB in early December.
The pair EUR / USD, thus, will be under pressure against the background of the two most important fundamental factors to begin with - the middle of December, when will the next meeting of the ECB and the Fed.
Today, it is worth paying attention to the news on the US. From 12:30 to 14:00 (GMT) block out important news. Given that the market reacted sluggishly to yesterday's weak data on US GDP, while the output data rates better than forecast, the pair EUR / USD, is likely to continue to decline
See also review and trading recommendations for the pair USD/JPY!
