Good day forex traders. Welcome to our popular weekly report of the EUR/USD.
In the previous forecast we noted that the currency pair was undecided and closed within the pivot region. From a fundamental point of view, the Euro Zone faced the challenges of a low inflation rate and high unemployment. The US Non Farm Payroll came out less than expected.
Looking at the EUR/USD weekly chart above we noted that the currency pair remained within the pivot region towards the upside. It has been a number of week since we left the lows of 1.0x.
Should bullish momentum take hold, we may be looking at a resistance of 1.14 which is also the upper bollinger band.
Bearish developments will need to breach the pivot region of 1.12 first before considering lower values.
It was reported in BBC and I quote”
German exports fell sharply in July, posting their steepest drop in nearly a year, after the country’s goods saw lower global demand.
Seasonally adjusted exports fell 2.6% compared with the month before, the biggest monthly drop since August 2015.
The figures from Destatis followed economic data that painted a gloomy picture for German manufacturing.
Industrial orders barely rose in July and output fell the most in nearly two years.”
This is of significance as Germany is Euro Zone ‘s biggest economy. Should it face challenges, it is likely to impact the rest of the EU members.
Next week brings the German ZEW Economic Sentiment report. It is highly regarded by the market and hence we need to keep a close watch.
Over in the US, the S&P 500 dipped recently and it could be an indicator of a lower risk appetite. The upcoming US Retail Sales report will be important as it is an indicator of the economy’s health.