empty
 
 

Forex Analysis & Reviews: EURUSD: Euro recovers bullish position
time 06.12.2022 06:45 PM
time Relevance up to, 11.12.2022 02:53 PM

The acceleration of business activity in the US services sector from the ISM sent EURUSD to a knockdown, but during the European trading session, the euro began to recover. This happened due to the growth in German manufacturing orders by 0.8%, which was better than Bloomberg's forecast of +0.1% MoM, and the statement of the European Central Bank Chief Economist Philip Lane that the inflation slowdown in November does not mean that the peak is over. It could come in 2023. It looks like the leading economy of the currency bloc is not feeling as bad as expected, and the ECB is not thinking of pausing in the process of tightening monetary policy.

Dynamics of production orders in Germany

This image is no longer relevant

Thus, positive statistics on the US strengthened the dollar, and on the currency bloc—the euro. The principle of "strong economy means strong currency" continues to work, although all these data have a local impact on the EURUSD dynamics. The fate of the main currency pair will be determined next week, by December 16. The release of data on US inflation and the Fed meeting will become a litmus test of the readiness of sellers of the US currency to continue the beating of their opponents that began in November.

The impact of the energy crisis should not be underestimated either. According to ING, the rise in oil prices due to the EU embargo and the G7's bandwagon against Russian black gold, as well as cold weather in Europe, will lead to a tighter gas market, which will have a negative impact on EURUSD. The company predicts that the euro will fall below $1,045, with a further decline by the end of the year.

So far, this scenario has not materialized. Despite serious restrictions on the movement of Russian oil, there is no growth in Brent quotes, and increased reserves of blue fuel in Europe smooth out the negative from expectations of a cold snap and an increase in demand. Storage occupancy is currently around 91%.

Dynamics of gas reserves in Europe

This image is no longer relevant

Lane's speech did not bring preferences to either "bulls" or "bears" in EURUSD. On the one hand, the chief economist doubted that the peak of inflation was passed, which indicates a continuation of the tightening cycle of monetary policy, at least in 2023. On the other hand, he said that when making decisions, the ECB should take into account the cumulative effect of previous increases in the cost of borrowing . The rate has already increased by 200 bps. Such rhetoric signals the intention of the European Central Bank to raise it not by 75 but by 50 bps.

This image is no longer relevant

In my opinion, ahead of the release of inflation data in the US on December 13 and the announcement of the results of the FOMC meeting on December 14, EURUSD will storm, but up and down movements will be local in nature, eventually forming a consolidation.

Technically, the upper limit of the estimated EURUSD trading range is in the area of 1.0565–1.061, the lower one is in the area of 1.0385–1.0445. The growth of quotes of the main currency pair, followed by a rebound from resistance, should be used for sales. On the contrary, unsuccessful assaults on supports are for the formation of longs.

Marek Petkovich,
Chuyên gia phân tích của InstaForex
© 2007-2023
EURUSD
Euro vs US Dollar
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Start trade
Start trade

InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.

  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    THAM GIA CUỘC THI
  • Tiền gửi lần truy cập
    Ký quỹ tài khoản của bạn với $3000 và nhận được $10000 nhiều hơn!
    Trong Tháng 01 chúng tôi xổ $10000 trong chiến dịch Chancy Deposit!
    Có được một cơ hội giành chiến thắng bằng việc ký quỹ $3000 vào một tài khoản giao dịch. Đáp ứng được điều kiện này, bạn trở thành một người tham gia chiến dịch.
    THAM GIA CUỘC THI
  • Giao dịch khôn ngoan, thành công
    Nạp tiền vào tài khoản của bạn với ít nhất $ 500, đăng ký cuộc thi và có cơ hội giành được các thiết bị di động.
    THAM GIA CUỘC THI
  • 100% tiền thưởng
    Cơ hội duy nhất của bạn để nhận 100% tiền thưởng khi gửi tiền
    NHẬN THƯỞNG
  • 55% Tiền thưởng
    Đăng ký tiền thưởng 55% cho mỗi lần gửi tiền của bạn
    NHẬN THƯỞNG
  • 30% tiền thưởng
    Nhận 30% tiền thưởng mỗi khi bạn nạp tiền vào tài khoản của mình
    NHẬN THƯỞNG

Recommended Stories

ECB rates to peak longer than Fed rates, pushing EURUSD above 1.2

Forex is a place where questions never end. In the first phase of monetary tightening, investors worry about how quickly rates will rise. Then, how high they will grow. Finally

Marek Petkovich 15:10 2023-01-27 UTC+2

Does the US debt ceiling issue pose a threat to the world economy?

Additionally, US President Joe Biden blasted the Republicans, alleging that they want to use the debt ceiling as leverage in economic negotiations, as the markets were getting ready

Jakub Novak 12:11 2023-01-27 UTC+2

The euro has a good chance

According to a survey of analysts, the European Central Bank's decision to raise interest rates by 50 basis points is already final, so the euro has a high probability

Jakub Novak 12:01 2023-01-27 UTC+2

GBP/USD. Overview for January 27, 2023

On Thursday, the GBP/USD currency pair maintained its upward trend. If we consider the daytime, which is the period of greatest activity, the US dollar increased for little more than

Paolo Greco 11:47 2023-01-27 UTC+2

EUR/USD. Overview for January 27, 2023

The EUR/USD currency pair is gradually increasing. This is because nothing has changed over the last day, as we have stated. The present upward trend will not be interrupted even

Paolo Greco 11:35 2023-01-27 UTC+2

Economic growth in the US was strong at the end of 2022

The key takeaway from yesterday's Q4 GDP report was that economic growth in the US was strong at the end of 2022, thanks to the strong labor market and lower

Irina Yanina 11:25 2023-01-27 UTC+2

Soft landing of the US economy could boost markets, but pressure dollar

Mixed economic data from the US had caused a downturn in stock markets, but the situation leveled off later, allowing indices to crawl back up again. The reports indicated that

Pati Gani 10:08 2023-01-27 UTC+2

EUR/USD. U.S. GDP growth was better than expected, but the dollar reacted weakly to the report

The euro-dollar pair reacted erratically to the latest US GDP report. Initially, the price fell to the lower limit of the 1.0850-1.0950 range, then returned to the area

Irina Manzenko 22:52 2023-01-26 UTC+2

EURUSD: Can ECB push EUR higher?

If the market does not go in the direction it is expected to be seen, it is more likely to go in the opposite direction. Will this principle of technical

Marek Petkovich 17:39 2023-01-26 UTC+2

Fresh data on US inflation could determine the path of the Fed

Before the Fed holds its first committee meeting for this year, a report on core PCE will be released, which will definitely have an impact on the decisions the central

Irina Yanina 15:08 2023-01-26 UTC+2
Không thể nói chuyện ngay bây giờ?
Đặt câu hỏi của bạn trong phần trò chuyện.