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
Mixed
GBP/USD
Mixed
USD/JPY
Mixed
Gold
Bullish
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
Oil - US Crude
Bullish
Bitcoin
Bearish
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
More View more
Real Time News
  • RT @onlyyoontv: Watching #HongKong elections Sunday. 4mln ppl hit polls. Seen as referendum on pro-democracy movement. Security tight. Fear…
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.02%, while traders in France 40 are at opposite extremes with 79.87%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/MsDN4XgJAR
  • What are the truths and myths of #forex trading? Find out from @DailyFX analysts here: https://t.co/uF75VPzstr https://t.co/soLloKxMYl
  • Commodities Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Silver: 0.65% Gold: 0.51% Oil - US Crude: -0.57% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/t2PxpO1HEm
  • Forex Update: As of 11:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.16% 🇯🇵JPY: 0.13% 🇨🇦CAD: -0.02% 🇨🇭CHF: -0.06% 🇪🇺EUR: -0.06% 🇬🇧GBP: -0.27% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/iI1uVqA6M3
  • Gold Price: Signals to Break the Deadlock - XAU/USD Forecast More details in the link below: https://www.dailyfx.com/forex/technical/home/analysis/xau-usd/2019/11/22/Gold-Price-Signal-to-Break-the-Deadlock-XAUUSD-Forecast-MK.html?CHID=9&QPID=917714 https://t.co/0pz8KRXUxG
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: US 500: 0.21% Wall Street: 0.19% France 40: 0.14% Germany 30: -0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/b315HhEW59
  • Crptos getting really ugly...Bitcoin trades with a 6-handle... #btc #eth #bch #xrp @DailyFX Latest prices from @IGcom https://t.co/aRrOWqrklw
  • LIVE NOW! Currency Strategist @PaulRobinsonFX runs through his favorite charts and potential set-ups for the week ahead in the FX and CFDs market here - https://www.dailyfx.com/webinars/108721147?CHID=9&QPID=917720
  • Crypto prices from @IGcom #btc #eth #bch #xrp @DailyFX https://t.co/ccioeMTbb3
EURUSD Rate Eyes Monthly-Low as Germany Warns of Economic Slump

EURUSD Rate Eyes Monthly-Low as Germany Warns of Economic Slump

2019-08-20 00:30:00
David Song, Currency Strategist
Share:

Euro Rate Talking Points

EURUSD extends the decline from the previous week as the Bundesbank warns of an economic “slump,” and the weakening outlook for the Euro area may continue to drag on the exchange rate as it puts pressure on the European Central Bank (ECB) to support the monetary union.

EURUSD Rate Eyes Monthly-Low as Germany Warns of Economic Slump

EURUSD approaches the monthly-low (1.1027) as Germany’s central bank warns “economic activity could decline slightly again in the current quarter,” and signs of a looming recession may push the ECB to implement more non-standard measures as the central bank struggles to achieve its one and only mandate for price stability.

It seems as though the ECB will continue to push monetary policy into unchartered territory even though the central bank prepares to launch another round of Targeted Long-Term Refinance Operations (TLTRO) in Septemberas Governing Council member Madis Muller insists that the weakening outlook “may mean that the central bank will have to add stimulus.

Image of ECB interest rates

In turn, a growing number of Governing Council officials may show a greater willingness implement a negative interest rate policy (NIRP) for the Main Refinance Rate, its flagship benchmark for borrowing costs, and the account of the ECB’s July meeting may ultimately prepare European households and businesses for a more accommodative stance as the central bank “stands ready to adjust all of its instruments, as appropriate, to ensure that inflation moves towards its aim in a sustained manner.

However, it remains to be seen if the Governing Council will make a major announcement at the next meeting on September 12 as President Mario Draghi steps down at the end of October.

With that said, the monthly opening range sits on the radar for EURUSD, with recent price action raising the risk for a run at the August-low (1.1027) as the exchange rate searches for support.

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss key themes and potential trade setups surrounding foreign exchange markets.

EUR/USD Rate Daily Chart

Image of eurusd daily chart

Source: Trading View

  • The broader outlook for EURUSD is clouded with mixed signals as the exchange rate clears the May-low (1.1107) following the Federal Reserve rate cut in July, with the 1.1100 (78.6% expansion) handle no longer offering support.
  • The Relative Strength Index (RSI) highlights a similar dynamic as the oscillator fails to retain the upward trend from earlier this year, with the oscillator now tracking a bearish formation.
  • As a result, the rebound from the monthly-low (1.1027) may continue to unravel amid the string of failed attempts to close above the Fibonacci overlap around 1.1190 (38.2% retracement) to 1.1220 (78.6% retracement).
  • Need a break/close below 1.1040 (61.8% expansion) to open up the downside targets, with the next area of interest coming in around 1.0950 (100% expansion) to 1.0980 (78.6% retracement).

For more in-depth analysis, check out the 3Q 2019 Forecast for Euro

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other markets the DailyFX team is watching? Download and review the Top Trading Opportunities for 2019.

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong.

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

DISCLOSURES

News & Analysis at your fingertips.