What Is The Euro's Path ?

Between the USD and the gold strength? Or, between the USD strength and the Gold prices hike?

As we witnessed yesterday, the Forex market was extremely volatile. In spite of its remarkable losses since the beginning of this week, the Gold recovered and gained last night.

The USD remained strong regardless of the gold’s strength, whilst traders believe that the Gold is their safe-haven.

While the EUR remains under great pressure, as it has been in a bearish condition for the last few months. Recently, the pressure increased due to the changes in oil and Gold prices. Today, the euro is expected to be neutral awaiting Thursday’s ECB meeting output.

Here are the major Resistance (R) & Support (S) levels of the EUR/USD:

S2 S1 Pivot Point R1 R2
1.2374 1.2415 1.2460 1.2515 1.2580

As for today’s figures, starting with Australia; the Reserve Bank of Australia (RBA) board members agreed on the rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.

Ø Actual: 2.50%
Ø Forecast: 2.50%
Ø Previous: 2.50%

A higher than expected rate is positive for the AUD, while a lower than expected rate is negative for the AUD.

Moving to the UK, the Chartered Institute of Purchasing and Supply (CIPS) Construction Purchasing Managers Index (PMI) is scheduled for release; measuring the activity level of purchasing managers in the construction industry. A reading above 50 indicates an expansion in the construction industry; while a reading below 50 indicates a contraction in the construction industry.

Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of the overall economic performance.

Ø Forecast: 61.2
Ø Previous: 61.4

A higher than expected reading should be taken as positive for the GBP, while a lower than expected reading should be taken as negative for the GBP.

As for the U.S., the Federal Reserve Chair, Janet Yellen, is expected to speak today. Being the head of the Fed, which controls short term interest rates, she has more influence over the U.S. dollar's value than any other person.

Traders closely watch her speeches as they are often used to drop hints regarding future monetary policy, her comments may determine a short-term positive or negative trend.

As for the energy market, the report of the American Petroleum Institute is scheduled for release; measuring the inventory levels of the US crude oil, gasoline and distillates stocks. This report shows how much oil and products are available in storage. This indicator gives an overview of the US petroleum demand.

API Weekly Crude Stock:

Ø Forecast: N/A
Ø Previous: 2.800 M

API Weekly Distillates Stocks:

Ø Forecast: N/A
Ø Previous: -1.300 M

API Weekly Gasoline Stock:

Ø Forecast: N/A
Ø Previous: 0.043 M


Disclaimer: The prices and news mentioned in this outlook are absolutely no guarantee of future market performance. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.
Engaging in CFDs or Spot FX carries a high risk to your capital. You should not engage in this form of investing unless you understand the nature of the Transaction you are entering into and the true extent of your exposure to the risk of loss. Your profit and loss will vary according to the extent of the fluctuations in the price of the underlying markets on which the trade is based.