HomeForex MarketEuro Overlooks German Shopper Confidence Miss

Euro Overlooks German Shopper Confidence Miss

EUR/USD ANALYSIS

  • Peace talks bolster Euro.
  • GfK Shopper Confidence (April) – ACT: -15.5; EST: –14.

EURO FUNDAMENTAL BACKDROP

As many anticipated, GfK Shopper Confidence figures slumped for the month of April which displays the continued scenario in Ukraine. Sadly, precise information printed far worse than anticipated at -15.5 – final seen in Could 2021. Surprisingly, the Euro dismissed the information primarily attributable to a stronger U.S. greenback.

Later in the present day, we look ahead to U.S. Shopper Confidence for March (additionally anticipated decrease) together with the Fed’s Williams and Harker speeches. Appearing as a assist for EUR/USD bulls is the optimism round peace talks between Russia and Ukraine which can present some respite short-term ought to or not it’s realized however the central financial institution divergence strongly favors greenback appreciation.

EUR/USD ECONOMIC CALENDAR

Supply: DailyFX financial calendar

The rate of interest chances for each the ECB and Federal Reserve respectively are proven within the tables under and echo their contrasting narratives. Cash markets are already pricing in an especially aggressive Fed which some might really feel might restrict greenback upside however we’re but to see this hawkish stance translate over to the greenback since late 2021. Subsequently, my long-term outlook stays skewed in direction of the USD even when the scenario in Ukraine eases.

ECB RATE PROBABILITIES

ECB rate probabilities

Supply: Refinitiv

FEDERAL RESERVE RATE PROBABILITIES

Fed rate probabilities

Supply: Refinitiv

TECHNICAL ANALYSIS

EUR/USD DAILY CHART

EURUSD daily chart

Chart ready by Warren Venketas, IG

Yesterdays decrease lengthy wick candle is suggestive of further upside in the present day which appears to be creating. Value motion confirmed EUR/USD pushing above the 1.1000 psychological stage however discovering resistance across the 20-day EMA (purple) zone.

The present doji print for todays candle is indicative of hesitancy by markets forward of key financial information releases. As talked about above, my partiality is with the USD however geopolitics might give the Euro a quick increase earlier than persevering with its downward trajectory.

Resistance ranges:

  • 1.1138
  • 50-day EMA (blue)
  • 20-day EMA (purple)

Assist ranges:

  • 1.1000
  • Triangle assist (black)
  • 1.0867 (March 2022 swing low)

INDECISION SHOWN BY IG CLIENT SENTIMENT

IGCS exhibits retail merchants are at present LONG on EUR/USD, with 63% of merchants at present holding lengthy positions (as of this writing). At DailyFX we sometimes take a contrarian view to crowd sentiment nevertheless, latest adjustments in lengthy and quick positions have resulted in a blended bias.

Contact and comply with Warren on Twitter: @WVenketas

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