Eur/usd - page 144
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EUR/USD dips as dollar firms on U.S. homebuilder sentiment data
An upbeat report on U.S. homebuilder sentiment pushed the dollar higher against the euro on Monday.
In U.S. trading, EUR/USD was down 0.29% at 1.3362, up from a session low of 1.3359 and off a high of 1.3399.
The pair was likely to find support at 1.3336, last Tuesday's low, and resistance at 1.3412, Friday's high.
The National Association of Home Builders/Wells Fargo Housing Market Index increased to 55.0 in August, a seven-month high, from 53.0 in July, beating estimates for a reading of 53.0.
A level above 50.0 indicates a favorable outlook on home sales and below indicates a negative outlook.
“As the employment picture brightens, builders are seeing a noticeable increase in the number of serious buyers entering the market,” said NAHB Chairman Kevin Kelly.
Waning fears that the Russian-Ukraine conflict will escalate also bolstered the greenback.
Russian and Ukraine foreign ministers were set to meet later in the day, which sparked hopes that diplomats will reach a breakthrough to ease geopolitical tensions in the region.
The euro, meanwhile, continued to come under pressure due to ongoing expectations that monetary stimulus programs in the U.S. will wind down at the same time the European Central Bank takes steps to loosen policy.
Elsewhere, the euro was down against the pound, with EUR/GBP down 0.51% at 0.7988, and down against the yen, with EUR/JPY down 0.15% at 136.98.
The pound strengthened broadly after Bank of England Governor Mark Carney said over the weekend that interest rates could rise before wage growth picks up.
In a newspaper interview published on Sunday, Carney said that the bank did not have to wait for wage growth to recover before raising interest rates, shifting away from comments last week indicating the opposite.
Investors were looking ahead to Wednesday’s minutes of the BoE’s August policy meeting for signs that the bank is moving closer to hiking benchmark interest rates.
On Tuesday, the U.S. is to release reports on building permits, housing starts and consumer inflation.
source
thanks for the news
Even With Extended Positions No Euro Short Squeeze - Analysts
Speculative net euro short positions are deemed at extended levels, the lions' share of the market is a euro bear and the euro can not seem to move lower and yet none of these things has resulted in a euro short squeeze, traders said.
While the euro is not going down to the degree that the market would like, the pair is also not going up, which allays fears of a larger unwind of positions.
The euro was trading at $1.3361 at midday Monday, on the low side of a $1.3353 to $1.3399 range. The pair has bottomed on several occasions in the $1.3330-40 range in August and the market wants to see a clear-cut break of the 2014 low near $1.3333, seen August 6, before becoming more bearish.
At the same time, after topping out at $1.3445 Friday August 1, U.S. non-farm payroll day, the euro has made a series of lower highs, which helps euro bears maintain their bearish bent.
It will take a decisive move below $1.3330 or above $1.3445 for momentum to mount in either direction, they said.
"While EUR/USD has held the important $1.3295 November low, the bounce has failed to extend back above the critical $1.3445/$1.3505 resistance zone (recent highs, downtrendline from the May peak, former range lows and breakdown area)," said Niall O' Connor, technical analyst at JP Morgan in a note.
As long as this resistance zone remains intact, "the short term downside risks should prevail," he said.
While the market is decidedly euro bearish, there are concerns about positioning.
CFTC data released Friday for positions as of August 12, showed speculative accounts had a net euro short position of -126,017 contracts, only marginally trimmed from the prior week's net short of -128,747 contracts, which was the largest net euro short since Aug. 14, 2012 (-137,810 contracts).
A net position with a contract size over 100,000 contracts, can be deemed extended, although the contract size may stay well over 100,000 contracts for many weeks before positions are trimmed.
Bank of America Merrill Lynch's monthly fund managers survey, taken August 1-7 and released August 15, highlighted the growing pressure on the euro.
A net 40% of those polled in August said the euro is "the currency they most expect to depreciate (on a trade-weighted basis), a reading that represents a two-year high in negativity towards the euro, up from a net 28 percent in July," BOA Merrill Lynch said.
So far, most analysts were not particularly worried about the euro short trade being crowded.
"High conviction trades," like the "short-yen" or "long cable" trades popular in 2013, "the market tends to hold longer," noted Vassili Serebriakov, currency strategist at BNP Paribas.
As long as the current "monetary divide exists" between the European Central Bank and Federal Reserve, "the market feels comfortable" with a euro short position, he said.
BNP Paribas viewed the current euro shorts as only somewhat overextended and something likely to only stall the euro's slide, not stem it.
"I'd be more worried if positions were out of line with fundamentals and heavy at the same time," Serebriakov said.
BNP Paribas economics team no longer saw a broad ECB asset purchase program as likely, BNP strategists said.
"The reduced likelihood of a QE program implies a somewhat slower path of EUR depreciation," they said.
BNP Paribas has a $1.3200 euro forecast for the end of 2014 and a $1.2600 forecast for the end of 2015.
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EUR/USD Aug. 19 – Markets Await US CPI Data
EUR/USD is trading quietly on Tuesday, as the pair trades in the mid-1.33 range in the European session. On the release front, there was more bad news out of the Eurozone, as Current Balance dropped sharply in July. In the US, we’ll get a look at key inflation indicators, with the release of Core CPI and CPI. As well, Building Permits and Housing Starts are also on today’s schedule.
Here is a quick update on what’s moving the pair.
Further levels in both directions:
EUR/USD Fundamentals
*All times are GMT.
For more events and lines, see the Euro to dollar forecast.
EUR/USD Sentiment
source
New 9 month low for EUR/USD following US housing data
The good news from the US housing sector sends the dollar higher and EUR/USD tumbles below the previous support line of 1.3333.
The low so far is 1.3325, exactly at an old support line, before 1.3333 was established as a bottom in August. Update: this line is gone as well. The current new low is 1.3318.
The pair is now at the lowest since November 2013. And the next support line is the November 2013 low of 1.3295. Resistance comes at 1.3415, followed by 1.3450. The pair is trading within a narrowing downtrend channel, as seen on the daily chart.
EUR/USD was pressured down by weak GDP numbers last week, as well as yet another fall in German business confidence.
We have heard from the president of the ECB Mario Draghi that the “fundamentals are in place” for a weaker EUR/USD. The pair is perhaps not at the optimal point for the ECB, but the direction continues to be down and steady grind lower is probably met with quiet praise.
We will hear from Draghi and from Yellen on Friday.
source
yup that was a big drop to fall under the support . thank you for the news
Interbank, Bund rates hit lows as euro zone outlook dims
Euro zone money market rates fell to new lows on Tuesday and German Bund yields dropped below 1 percent as the region's weak recovery kept up pressure on the European Central Bank to maintain its ultra-loose monetary policy.
With a new tit-for-tat sanctions between Russia and the West being discussed as the Ukraine conflict rumbles on, investors are growing increasingly certain that subdued growth and inflation will herald a prolonged period of low rates.
Money market traders now see an even 50 percent chance of an ECB asset-purchase programme, known as quantitative easing, in the coming year, a Reuters poll found on Monday. A previous survey showed only a one-in-three chance.
While investors see a long period of low price growth ahead, they expect the ECB to prevent the euro zone economy to fall into a Japan-like deflationary spiral.
"We are not willing to bet against the ECB doing whatever is necessary to avoid Japanese-style policy mistakes," said Michael Krautzberger, head of European fixed income at BlackRock.
Yields on German 10-year Bunds - the benchmark for euro zone borrowing costs - fell back below 1 percent on Tuesday. They hit a record low of 0.952 percent last week.
The euro bank-to-bank overnight lending rate settled at a record low of 0.006 percent on Monday, helped by ample spare cash in the euro zone's banking system, which currently stands at 134 billion euros.
The ECB cut all its interest rates in June and made new four-year loans (TLTROs) available to euro zone banks from September. It also injected liquidity into money markets by abandoning a tender to sterilise crisis loans.
But strategists say current market prices are starting to price in further policy easing ahead
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German Producer Price Inflation -0.1% vs. 0.1% forecast
Germany’s producer price index fell unexpectedly last month, official data showed on Wednesday.
In a report, Destatis said that German Producer Price Inflation fell to a seasonally adjusted annual rate of -0.1%, from 0.0% in the preceding month.
Analysts had expected German Producer Price Inflation to rise 0.1% last month.
the negative data destroyed the EUR . thanks for the information
French PMIs mixed: manufacturing misses, services beat
French manufacturing PMI stands at 46.5 and services at 51.1 points. Basically we have one upside surprise and one downside surprise.
EUR/USD only marginally moves to the downside.
Markit was expected to report that French manufacturing PMI ticked up from 47.8 to 47.9 points in August (preliminary reading). The services sector was expected to edge down from 50.4 to 50.3 points. The 50 point mark separates contraction from growth.
EUR/USD was recovering from the lows, rising to 1.3260 just before the publication.
We have a busy day today with more PMIs from Germany and then for the whole euro-zone. And later on, we have important figures from the US.