Alpesh Patel's NewsletterPro - Euro and Pound hold above critical support levels but for how long?

Share On Facebook
share on Linkedin
© Alpesh Patel

Friday was a quiet day for the currency market even though we expected important news from the UK with the Retail Sales release. The release was expected to surprise to the upside on the back of the recent improvements in the UK economy, however the figures showed a 1.5% decline in January.

The Pound received these numbers without a big sell-off and the UK currency remained above the 1.6600 level which at this point is the key support. Any further news will prove critical for the Pound because if the 1.6600 support gets broken then further losses should be expected. News from the UK economy are not expected until Wednesday when the Q4 GDP is scheduled for release so until then the GBP/USD will mostly be affected by Dollar’s flows.

The Euro continued climbing higher against the Dollar even though there were no economic news to attract new buyers. The peace deal in Ukraine after an extended period of political turmoil has eased tensions in the European region and the news allowed the European currency to remain above the 1.3700 mark. This is Euro’s important support area and even though the technical outlook of the currency hints towards lower levels as long as 1.3700 holds new highs shouldn’t surprise us. Today we expect the release of the IFO Survey and Euro-zone’s inflation data and especially the latter can be a potential market mover.

The Dollar remained on the downside and the recent string of discouraging figures out of the US economy continued with housing market data showing once again how severe weather conditions have taken their toll to the domestic economy. The US currency has been under pressure lately but Fed officials continue to support their tapering agenda and appear confident that the recent disappointing figures are only temporary and mostly attributed to the bad weather hence the released figures will soon bounce higher.

German IFO Survey and Euro-zone inflation data for today

The Economic Calendar today only holds a couple of economic releases but both of them are quite important. The German IFO Survey is scheduled for release early in the morning and the survey acts as a measure of confidence in the Euro-area’s current and future outlook. The report is expected to remain in line with previous releases but we feel there’s room for a surprise to the downside.

An hour later, the Euro-zone’s Consumer Price Index will be released and with the inflation being on the forefront of Europe’s fiscal concerns the report is eagerly anticipated. Europe is battling its way out of recession and the fact that inflation remains stubbornly low troubles the ECB and a discouraging release here will definitely be reflected on the currency’s outlook.

Economic Calendar

Time

Currency

Event

Importance

Forecast

Previous

9.00

EUR

German IFO – Current Assessment

Medium

112.8

112.4

9.00

EUR

German IFO – Expectations

Medium

108.1

108.9

10.00

EUR

Euro-zone CPI – Core

High

0.8%

0.8%

10.00

EUR

Euro-zone CPI

High

0.7%

0.7%

 

 

TECHNICAL ANALYSIS & LEVELS

EUR/USD

GBP/USD

FTSE 100

Gold

This is the freely distributed Morning Brief section of the NewsletterPro – Forex Opportunities report, a subscription-based product.
If you would like to receive the full version of the report along with specific trading suggestions, please subscribe by clicking here

 

Disclaimer Notice

Past performance is not indicative of future results. Trading forex, CFDs and equites carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent financial advisor if you have any doubts.

The information provided by InvestingBetter.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. InvestingBetter.com are merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite.

InvestingBetter.com and/or its owners will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained on InvestingBetter.com. InvestingBetter.com does not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20200805 14:16:54