Good day forex traders.
Welcome to our review of the EUR/USD currency pair.
As we approach midweek, I hope that everyone is making good progress. A gentle reminder that forex trading is never a get rich quick bonanza.
Support and resistance region by the numbers are 1.16 and 1.18 / 1.2 respectively. It is good to note that the middle bollinger band is in the region of 1.16, likely adding to the support’s foundation.
Bloomberg reports an unexpected outcome for a German release. ”
German business confidence unexpectedly rose to a record high in October, signaling that growth momentum in Europe’s largest economy remains far from waning.
Sentiment rose to 116.7, the Munich-based Ifo Institute said on Wednesday. That’s up from a revised 115.3 in September. Economists surveyed by Bloomberg expected a drop to 115.1.
Ebullient optimism suggests the German economy’s strong performance at the start of the year will spill into the final quarter. The Bundesbank sees the nation’s solid upswing continuing amid vigorous demand from abroad for industrial goods and healthy consumer spending at home on the back of declining unemployment.
“It’s the combination of a very strong global economy from which German exporters benefit, and the fact that the euro hasn’t continued to rise,” said Andreas Rees, an economist at UniCredit Bank AG in Frankfurt. “In addition, the domestic economy is also doing very well.”
The euro was little changed after the report and traded at $1.1765 at 10:24 a.m. Frankfurt time. The single currency gained more than 14 percent between January and mid-September, before stabilizing in the past few weeks.
German gross domestic product is set to increase 2.1 percent this year, the fastest pace since 2011, according to economists’ forecasts compiled by Bloomberg. Strength in the euro area’s largest economy will likely weigh into discussions when European Central Bank officials meet on Thursday to devise a plan for how to slow monetary stimulus in the region. ”
The EUR/USD is rather subdued at the moment despite releases such as the above. It is possible that investors are cautious of the ECB minimum bid rate event later this week. There are expectations as to having more light shed on the central bank’s plan to dial back quantitative measures implemented during the financial crisis. A reduction on supply may provide a push on the Euro currency’s value.
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