We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Mixed
Gold
Bullish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Mixed
More View more
Real Time News
  • The Australian Dollar remains severely weighed down by #coronavirus worries and a lack of domestic data points will probably keep that story in the driving seat. Get you $AUDUSD market update from @DavidCottleFX here: https://t.co/qswUnnXVwR https://t.co/NyZ0iEpILm
  • While Sino-US trade jitters are temporarily abating, China-Swedish trade tensions are rising as a part of a political contagion of growing economic hostilities between nations across the world. Get your market update from @ZabelinDimitri here:https://t.co/F1fVoyzoz5 https://t.co/uOLKRebXB1
  • #DidYouKnow the global trade volumes dropped by close to 10% amid the Great Recession. Want to know your #tradewars history? Get it here: https://t.co/f4loFVzX6w https://t.co/GDTFHvUIf7
  • The spread of #coronavirus promises a global economic hit at a time when the global economy is perhaps especially ill-equipped to deal with one. Growth-correlated assets are vulnerable. Get your market update from @DavidCottleFX here: https://t.co/0If0Jw7c2P https://t.co/mph6z70XeF
  • The $JPY continues to struggle against the US Dollar but there seems little appetite to push USD/JPY much beyond a range which has tended to reassert itself since late last year. Get your market update from @DavidCottleFX here: https://t.co/iaVfPSuXy4 https://t.co/1QPhJmYlQv
  • The #Euro may bounce after hitting the lowest level in close to three years against the US Dollar. While the broader trend points firmly lower, selling pressure may be ebbing. Get your market update from @IlyaSpivak here: https://t.co/697SQ9j5FY https://t.co/6SEvwQyod8
  • GBP/CAD has broken below the September uptrend while EUR/CAD may be ending its consecutive 12 day decline with EUR/CHF approaching key resistance as NZD/CAD aims at November lows. Get your currencies update from @ZabelinDimitri here: https://t.co/GpRB7IKhTA https://t.co/hlHlGdhkHc
  • The $GBP recoiled from chart resistance against the US Dollar, setting the stage for prices to resume a bearish trend reversal triggered mid-January. Get your market update from @IlyaSpivak here:https://t.co/lVpyZkIfJt https://t.co/9oXusxs0Kg
  • The #Euro may have more room to fall versus its major peers such as the US Dollar, Japanese Yen and British Pound. What is the technical picture of EUR/USD, EUR/JPY and EUR/GBP? Get your market update from @ddubrovskyFX here: https://t.co/M6fLA9g3BK https://t.co/HMwQgr1WP5
  • The $USD’s aggressive rise versus ASEAN currencies such as the Singapore Dollar, Indonesian Rupiah, Malaysian Ringgit and Philippine Peso prolonged. What is the technical road ahead? Find out from @ddubrovskyFX here:https://t.co/RsFptNzODf https://t.co/u8meQUSsVG
Forex: Euro Outlook Remains Bearish As Fundamentals Deteriorate

Forex: Euro Outlook Remains Bearish As Fundamentals Deteriorate

2011-09-27 13:20:00
David Song, Currency Strategist
Share:

Talking Points

  • Euro: Germany To Increase Assistance For Greece, ECB To Ease Further
  • British Pound: Correction To Gather Pace, Eyes 38.2% Fib
  • U.S. Dollar: To Trade Heavy On Risk Appetite, Consumer Confidence On Tap

Euro: Germany To Increase Assistance For Greece, ECB To Ease Further

German Chancellor Angela Merkel’s pledge to better-assist Greece sparked hopes of containing the sovereign debt crisis, and we may see the EU step up its efforts to balance the risks for the region as the German leader pushes the parliament to expand the European Financial Stability Facility beyond its current lending-capacity of EUR 440B. At the same time, European Central Bank board member Jozef Makuch talked up speculation for additional monetary support, stating that the 12-month loan program will be reestablish if necessary, and the Governing Council may continue to expand its nonstandard measures in an effort to calm the ongoing turmoil within the banking sector.

Indeed, there’s speculation that the EU will ultimately lay out a European-TARP plan to prop up the financial system,and the near-term rebound in the EUR/USD may continue to gather pace as the EU increases its effort to restore investor confidence. As the relative strength index comes off of oversold territory, we should see the euro-dollar continue to pare the sharp decline from the previous week, and the exchange rate may work its way back towards the 61.8% Fibonacci retracement from the 2009 high to the 2010 low around 1.3890-1.3900. However, the ‘golden ratio’ may play as near-term resistance, and the EUR/USD may resume the downward trend carried over from the previous month as the fundamental outlook for Europe remains bleak. In turn, the correction in the euro-dollar may be short-lived, and the pair may threaten the rebound from earlier this year (1.2873) as the euro-area faces an increased risk of a double-dip recession.

British Pound: Correction To Gather Pace, Eyes 38.2% Fib

The British Pound extended the advance from the previous day to reach a weekly high of 1.5630 and the sterling may push higher throughout the week as trader sentiment improves. In turn, the GBP/USD looks poised to work its way back above the 38.2% Fibonacci retracement from the 2009 low to high around 1.5680-1.5700, and we may see the pair make a run at the 20-Day moving average (1.5822) as market participants increase their appetite for risk. However, speculation for additional quantitative easing may bear down on the exchange rate as the Bank of England shows an increased willingness to expand monetary policy further, and the central bank may increase its efforts to stimulate the ailing economy in order to avoid falling back into a recession. As a result, speculation for further easing may threaten the rebound in the GBP/USD, and the sterling may face additional headwinds over the near-term as the fundamental outlook for the U.K. deteriorates.

U.S. Dollar: To Trade Heavy On Risk Appetite, Consumer Confidence On Tap

The U.S. dollar weakened against most of its major counterparts during the overnight session and the greenback may trade heavy throughout the North American trade as the rebound in risk appetite gathers pace. As the U.S. market is poised to open higher, market participants may continue to diversify away from the greenback, and a rebound in consumer confidence may fuel the rise in trader sentiment as it raises the outlook for future growth. In turn, the Dow Jones-FXCM U.S. Dollar Index (Ticker: USDOLLAR) may continue to give back the sharp advance from the previous week, and the gauge may come up against the 50.0% Fib around 9828 to test for near-term support.

Will the EUR/USD Retrace The Advance From Earlier This Year? Join us in the Forum

Related Articles: Weekly Currency Trading Forecast

To discuss this report contact David Song, Currency Analyst: dsong@dailyfx.com

FX Upcoming

Currency

GMT

EDT

Release

Expected

Prior

USD

13:00

9:00

S&P/Case-Shiller Composite-20 s.a. (MoM) (JUL)

0.10%

-0.06%

USD

13:00

9:00

S&P/Case-Shiller Composite-20 (YoY) (JUL)

-4.40%

-4.52%

USD

13:00

9:00

S&P/Case-Shiller Home Price Index (JUL)

141.3

USD

14:00

10:00

Consumer Confidence (SEP)

46.5

44.5

USD

14:00

10:00

Richmond Fed Manufacturing Index (SEP)

-9

-10

Currency

GMT

Release

Expected

Actual

Comments

JPY

23:50

Corporate Service Price (YoY) (AUG)

-0.4%

-0.4%

Declines for 35 consecutive months.

CNY

2:00

Industrial Profits (YTD) (YoY) (AUG)

--

28.2

Slowest pace of growth since May.

JPY

5:04

Small Business Confidence (SEP)

--

47.2

Highest since March.

EUR

6:00

German GfK Consumer Confidence Survey (OCT)

5.0

5.2

Holds steady for second month.

CHF

6:00

UBS Consumption Indicator (AUG)

--

0.79

Lowest since September 2009.

EUR

8:00

Euro-Zone M3 s.a. (3M) (AUG)

2.0%

2.3%

Fastest pace of growth since September 2009.

EUR

8:00

Euro-Zone M3 s.a. (YoY) (AUG)

2.0%

2.8%

EUR

8:00

Italian Hourly Wages (MoM) (AUG)

0.1%

0.0%

Holds flat for second straight month.

EUR

8:00

Italian Hourly Wages (YoY) (AUG)

--

1.7%

GBP

10:00

CBI Reported Sales (SEP)

-15

-15

Lowest since May 2010.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.