German IFO and Zew Survey Preview: What to expect of EUR/USD?
EUR/USD failed to cut through 5-DMA resistance of 1.1258 in Asia and now trades around 1.1245 levels ahead of German IFO release, which will be followed by Zew survey numbers.
IFO to show cautious optimism
IFO business climate indicator is expected to have stabilized in March after falling for three consecutive months. The indicator is likely to print around previous month’s reading of 105.7 and well above the long-term average of 101.6.
However, Brexit fears could keep the expectations index under pressure. Additionally, concerns surrounding Chancellor’s Merkel’s handling of migrant crisis could have an impact on the expectations index as well.
Meanwhile, Zew survey indices are likely to show the economy has had a “dynamic” start to the year. The survey is expected to show an improvement in the economic sentiment and current situation index. A weaker-than-expected IFO and Zew survey could weigh over Euro and vice versa. However, a pronounced risk-on/risk-off in the stock markets risks overshadowing IFO and Zew survey readings.
EUR/USD Technical Levels
The immediate hurdle is noted at 1.1258 (5-DMA), above which prices could target 1.13 handle. A violation there would expose resistance zone of 1.1336-1.342 (last week’s high). On the other hand, a breakdown of immediate support at 1.1218 (Mar 10 high) would shift risk in favor a drop to 1.1195 (rising trend line support) and 1.1115 (50% of 1.1714-1.0517).
(Market News Provided by FXstreet)
