EUR/USD Pulse Check 14 May 19


The EUR/USD is hovering above 1.12 along a minor support and resistance region.

EUR/USD Ranging For Now

Looking at the EUR/USD 60 minutes chart above, we note that the currency pair is mostly ranging within the limits of 1.12 – 1.125.

There was no significant forex gap observed at the start of the week.

The new trading week saw the escalated tension between the US and China ease a little to much relief. Both sides have been giving out trinkets of conciliatory signals. The equities market are slowly normalizing and we look forward to the forex price action reverting to the usual undertones without excessive apprehension.

The yellow lines plotted in the chart are the possible support and resistance regions in the immediate vicinity. As you can see on the chart, significant price action is found in those regions. Price action in shorter time frames are often sentimental in nature.

German ZEW Economic Sentiment Drops

The German ZEW Economic Sentiment came out much worse than expected. It reported a -2.1 instead of the forecast of 5.1. That is a cut of over 140%. As a survey of analysts who probably have good working knowledge of the economy, the result suggests that the general sentiment is of a bleak one. If the market catches up with this, we may see a relapse of the EUR/USD bearish pressure. Upcoming economic releases such as the German Preliminary GDP and Euro Flash GDP will be closely watched and may serve as a catalyst of momentum for either directions depending on the results.

Still to Come

Many important economic events are still to come and it will be even more critical now for us to assess each with the understanding of whether risk appetite has increased or decreased.

EUR German Preliminary GDP
EUR Flash GDP
Gross domestic product is a measure of the monetary market value of all the goods and services produced. Therefore it is an important overall measure of economic activity and health.
USA Core Retail Sales
USA Retail Sales
Retail sales is a fundamental component of the economy. As consumers spend, it translates to revenue and flows up stream as salaries, wholesales purchase, production orders and so on.
USA FOMC Member Quarles Speech
Speeches may contain a question and answer segment that may go into unscripted territory and result in unexpected developments and volatility.
EUR German Deutsche Bundesbank President Weidmann Speech
Speeches may contain a question and answer segment that may go into unscripted territory and result in unexpected developments and volatility.
USA Building Permits
The construction of a building generates many economic activities. Jobs will be created for construction workers, the various sub contractors and services associated with new buildings such as power, water, furniture and so on.
USA Philly Fed Manufacturing Index
Business Climate surveys are influential as the sentiment of businesses 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 FOMC Member Brainard Speech
Speeches may contain a question and answer segment that may go into unscripted territory and result in unexpected developments and volatility.
USA Preliminary UoM Consumer Sentiment
Consumer surveys are influential as the sentiment of consumers is a leading indicator of economic health. A healthy sentiment suggests that an economy is moving along well and hence consumers are confident. This likely leads to increased retail sales. A cautious sentiment on the other hand may see consumers spend less in view of a perceived upcoming economic crisis.
USA FOMC Member Clarida Speech
Speeches may contain a question and answer segment that may go into unscripted territory and result 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 premium analysis and our popular Price Action Bias Signals are now available too.

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

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