EURUSD on tech side. Weekly closed as inside week. Not good news for bulls.
Bears might get some action next 6-12 days, cause the fundie flow is overall
negative for EURUSD, FOMC/GDP/NFP and Brex will have negative impact.
key red items for EURUSD/DX next week.
FOMC - cut already priced in, meeting will have limited impact. Details - see note above from Danske. Limited/negative impact on EURUSD
GDP print for EZ - based on ZEW and PMI - there won't be any upside surprise, data will be weak. Negative impact on EURUSD
NFP on Friday - NFP lately has limited impact on price.
US data - more likely beats and is green. Negative impact on EURUSD.
Overall, quite a few red items, however won't have huge impact on price. Overall tone though is very likely negative for EURUSD.
Bears might get some action next 6-12 days, cause the fundie flow is overall
negative for EURUSD, FOMC/GDP/NFP and Brex will have negative impact.
key red items for EURUSD/DX next week.
FOMC - cut already priced in, meeting will have limited impact. Details - see note above from Danske. Limited/negative impact on EURUSD
GDP print for EZ - based on ZEW and PMI - there won't be any upside surprise, data will be weak. Negative impact on EURUSD
NFP on Friday - NFP lately has limited impact on price.
US data - more likely beats and is green. Negative impact on EURUSD.
Overall, quite a few red items, however won't have huge impact on price. Overall tone though is very likely negative for EURUSD.
Comment:
MUFG Research discusses EUR/USD tactical outlook and adopts a neutral bias, expecting the pair to trade sideways in a 1.1000-1.1250 range in the near-term.
"The euro’s upward momentum has now stalled in the nearterm undermined in part by the release of the latest PMI surveys for October which continued to signal that the euro-zone economy continues to slow heading into year end and is moving closer to stagnating. The release of the euro-zone GDP for Q3 will be scrutinized closely in the week ahead," MUFG notes.
"It remains to be seen whether recent optimism over progress towards a US-China trade and Brexit deal will eventually encourage a pick-up in growth. The EU is expected to grant the UK another Brexit extension in the week ahead, most likely until the end of January. However, it has become less clear how the UK government then plans to proceed to pass the Brexit deal through parliament. If the government pursues a snap election and is successful, then the additional political uncertainty could act as modest dampener on the pound and euro, although No Deal risks should remain diminished," MUFG adds.
"The euro’s upward momentum has now stalled in the nearterm undermined in part by the release of the latest PMI surveys for October which continued to signal that the euro-zone economy continues to slow heading into year end and is moving closer to stagnating. The release of the euro-zone GDP for Q3 will be scrutinized closely in the week ahead," MUFG notes.
"It remains to be seen whether recent optimism over progress towards a US-China trade and Brexit deal will eventually encourage a pick-up in growth. The EU is expected to grant the UK another Brexit extension in the week ahead, most likely until the end of January. However, it has become less clear how the UK government then plans to proceed to pass the Brexit deal through parliament. If the government pursues a snap election and is successful, then the additional political uncertainty could act as modest dampener on the pound and euro, although No Deal risks should remain diminished," MUFG adds.
Comment:
EURUSD H4 ICHI CLOUD WILL BE PIERCED SOON AND PRODUCE A NICE ENTRY ON SELL SIDE.
"We expect the Federal Reserve to cut rates again by 25bp when it meets next week. While economists are evenly divided between those expecting a cut and those expecting the Fed to remain on hold,investors have nearly fully priced in a cut...It is one of the interim meetings so the Fed will not publish updated projections (hence, no new dot plot).
Focus will be on the statement and the press conference following. We do not expect major changes to the statement but it was interesting that the FOMC members discussed whether to include some forward guidance on when to expect the Fed to end rate cuts for insurance reasons. We expect the Fed to keep the sentence that it ‘will act as appropriate to sustain the expansion’, i.e. easing bias without pre-commitment," Danske projects.
"Lack of pre-commitment to send EUR/USD lower. We look for a market reaction in EUR/USD to be similar to that of the September meeting, i.e. for EUR/USD to drop as the Fed once again fails to pre-commit to additional rate cuts – the potential is probably in the area of 50 pips. However, the market was a bit more aggressively priced at that point, so the reaction should be less pronounced," Danske adds.