EUR/USD Forecast 3 Sep 19


The EUR/USD is currently on a downside momentum.

Technical Analysis

Looking at the EUR/USD hourly chart above, we observe that the currency pair has been drifting towards 1.09 since the start of the week.  It appears to be facing increasing upside pressure as it approaches the support of 1.09.

Any return of a bullish recovery will likely face immediate resistance at the middle bollinger band, followed by the upper bollinger band.

Price Action May Pick Up Soon

While we have yet to received any significant economic releases since the start of the week, the US ISM Manufacturing PMI will be due shortly. As a survey of purchasing managers, it provides important insights as the sentiment of purchasing managers is a leading indicator of economic health. A healthy sentiment suggests that an economy is moving along well while a cautious sentiment may see less business activities due to prudence.

The US ISM Manufacturing PMI has been dropping since the last quarter of 2018 and is expected to report a flat 51.2. Any deviation from the expectation may trigger increased volatility, especially if it is significant. If the report suggests a deteriorating economic climate, risk aversion may be triggered.

The Week Ahead

We are expecting many high impact economic event including the US Non-Farm Payroll. Find below a number of economic events due after the US ISM Manufacturing PMI.

USA FOMC Member Rosengren Speech
USA FOMC Member Williams Speech
USA FOMC Member Bullard Speech
USA FOMC Member Evans Speech
Speeches may reveal new insights to economic policies or contain a question and answer segment that at times go into unscripted topics resulting in unexpected developments and volatility.

USA ADP Non-Farm Employment Change
Employment is a fundamental component of the economy as it leads to consumer spending and hence retail sales. A low unemployment rate is an indicator of a healthy functioning economy.
ADP’s statistics is based on the payroll data of approximately 400,000 U.S. business clients. Therefore it is viewed by many as a possible early indication of the US Non-Farm Payroll result.

USA ISM Non-Manufacturing PMI
Purchasing Managers’ Index is a survey of purchasing managers and is important as the sentiment of purchasing managers is a leading indicator of economic health. A healthy sentiment suggests that an economy is moving along well while a cautious sentiment may see less business activities due to prudence.

USA Crude Oil Inventories
Movement of oil supply may bring insights to the level of general economic activities. For example, an increasing supply may suggest excessive production or diminishing demand. A reducing supply on the other hand may suggest an economic pick up.

USA Average Hourly Earnings
USA Non-Farm Employment Change
USA Unemployment Rate
Employment is a fundamental component of the economy as it leads to consumer spending and hence retail sales. A low unemployment rate is an indicator of a healthy functioning economy.

USA Fed Chair Powell Speech
Speeches may reveal new insights to economic policies or contain a question and answer segment that at times go into unscripted topics resulting in unexpected developments and volatility.

There are many more events and hence it is important to follow an economic calendar. By doing so, you can reduce the possibility of an unexpected development affecting your trading plan.

Members can log in to their dashboards for an economic calendar. The latest Major Currency Pairs analysis and Price Action Bias Signals are available too.

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Traders should always practice proper money management and seek to understand the underlying tones for the market.

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